Minnesota DSCR Loans for STR Financing

Grow Your Portfolio with DSCR Loans

Whether you're investing in STRs near Duluth, long-term rentals in Minneapolis, or college-town properties in St. Paul, our DSCR loans  give Minnesota investors the flexibility and competitive rates needed to scale. These loans qualify you based on your property’s income—not personal W-2s or credit history. We evaluate the asset’s ability to cash flow and support the loan on its own. With a mix of urban and seasonal rental opportunities, Minnesota is a strong market for real estate investors at any stage. Our streamlined, asset-based approach makes it easier to grow your portfolio while avoiding the documentation hurdles of traditional loans.

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How to qualify

To obtain a quote, we will need the following information:

Property Value and

 Purchase Price


Down Payment

Amount


Credit Score



 Asset Types

  • Single Family Homes
  • Townhomes
  • Condos
  • 2 - 4 Units (Duplex, Triplex, Quadplex)
  • Multi-Family: 5 - 8 Units
  • Mixed-Use: 2 - 8 Units
  • Multi-Family: 9+ Unit



Loan Terms


  • Loan Sizes: $100k up to $3.5 Million (Larger loan sizes available on a case by case basis)
  • Purchase LTV: Up to 85%
  • Rate & Term Refinance LTV: Up to 80% 
  • Cash Out Refinance LTV: Up to 80%
  • Amortization: 30 Year % 40 Year Amortization Options Available
  • Term Lengths: 5/6 ARMs, 7/6 ARMs, 10 Year Interest Only, 30 Year Fixed & 40 Year Fixed
  • Floor Rate: 5.50% (subject to change daily due to market volatility)
  • Full Recourse with personal guarantee required for all borrowers with majority ownership (typically 20%+ or 25%+ if closing in an Entity)
  • DSCR Requirement: 1.00x or greater depending on loan size and property type. Sub-1.00x DSCR and NO DSCR options available.
  • Vesting: Lending to Individuals, LLCs, and Corporations. Trusts Allowable on a Case by Case Basis.
  • Average Time to Close: 14 to 35 days

Wondering if you qualify for investment property financing in your area?


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Frequently Asked Questions

What is a DSCR loan and how does it work for Minnesota real estate investors?

A DSCR loan (Debt Service Coverage Ratio loan) is built for real estate investors who prefer to qualify using the income a property produces instead of personal income or employment records. Lenders approve the loan when the rental income is enough to cover the property’s debt obligations. This structure works especially well for borrowers with unconventional financials or those focused on rapid portfolio expansion. In Minnesota markets like Minneapolis, St. Paul, and Duluth, DSCR loans offer the flexibility to invest in both STRs and long-term rentals without traditional barriers.

How is DSCR calculated in a typical loan scenario?

Minnesota lenders calculate DSCR by dividing a rental property's net operating income (NOI) by its annual debt obligations, including mortgage payments, taxes, and insurance. For instance, if a property in Minnesota earns $90,000 in NOI and its annual debt service is $75,000, the DSCR would be 1.20. This means the rental income exceeds the cost of the loan by 20%, which strengthens the financing application. While a 1.00 DSCR is the minimum required by most lenders in Minnesota, higher ratios are encouraged—especially for investors operating in Minneapolis, St. Paul, or Duluth. Understanding DSCR is critical for scaling your portfolio in Minnesota.

What is considered a good DSCR ratio for Minnesota investors when applying for financing?

In Minnesota, a DSCR of 1.20 or higher is considered strong by most lenders. While 1.00 is often the minimum acceptable ratio, it offers little cushion for unexpected costs or rental fluctuations. A 1.20 DSCR in Minnesota signals that the property is generating 20% more income than its debt service requires, which improves loan approval odds and may unlock better terms. Whether you're investing in Minneapolis, St. Paul, or Duluth, understanding DSCR benchmarks in Minnesota helps investors target high-performing assets and navigate financing with greater confidence.

Can I qualify for a DSCR loan if my personal income is limited?

Yes, you can qualify for a DSCR loan even if your personal income is limited. DSCR loans , often referred to as Airbnb loans when used for short-term rental properties, are designed to approve borrowers based on the income the property generates—not personal W-2s, tax returns, or debt-to-income ratios. Lenders calculate the property's debt service coverage ratio to determine if the income is sufficient to support the loan. As long as the DSCR meets the required threshold—usually 1.00 or higher—you can often be approved regardless of personal income. This makes Airbnb loans ideal for self-employed investors, business owners, or anyone scaling a rental portfolio without relying on traditional underwriting standards.

How does a lender evaluate rental income when approving a DSCR loan?

In Minnesota, DSCR lenders determine loan eligibility by evaluating rental income from the property itself. Minnesota investors submit lease agreements, short-term rental income history, or market rent data to demonstrate cash flow. That figure is used to calculate the DSCR by comparing it to the property’s annual loan obligations. A ratio of at least 1.00 is needed to qualify. DSCR loans in Minnesota are ideal for investors with non-traditional income or those scaling quickly. Understanding how rental income is evaluated in Minnesota is key for securing property-focused financing without W-2s or tax returns.

What’s the minimum debt service coverage ratio required for approval?

In Minnesota, DSCR loans typically require a minimum ratio of 1.00 for approval. Some Minnesota lenders may accept DSCRs as low as 0.75 under specific conditions, including strong credit profiles or asset-backed reserves. A DSCR of 1.20 or higher is generally preferred in Minnesota to secure better loan terms, especially in markets like Minneapolis, St. Paul, or Duluth. DSCR loans in Minnesota offer a flexible pathway for investors who need an alternative to W-2-based underwriting. Understanding the minimum DSCR expectations in Minnesota can help investors prepare stronger applications and close deals faster.

Who should consider using a DSCR instead of a traditional loan?

These loans are perfect for self-employed individuals, LLCs, and investors managing multiple properties. Minnesota borrowers turn to DSCR loans to avoid the complexities of personal income documentation. In markets like Minneapolis and St. Paul, Minnesota real estate investors qualify based on property income, enabling quicker expansion. DSCR loans in Minnesota are a great fit for those focused on efficiency and growth.

Expanding your rental portfolio beyond Minnesota? We also offer financing in Iowa and North Dakota , making it easy to scale across the Midwest with the same asset-based approval process.