Vermont DSCR Loans for STR Financing

Grow Your Portfolio with DSCR Loans

Whether you're purchasing STRs in Stowe, seasonal rentals in Burlington, or long-term properties in Montpelier, our DSCR loans  give Vermont investors flexible financing based on rental income. These loans qualify you using the property's cash flow—not your W-2s, tax returns, or credit score. We evaluate whether the income from your rental can support the loan obligations. Vermont’s seasonal demand and tourism-friendly markets make it ideal for investors targeting short-term and vacation rentals. With DSCR loans, you can scale quickly and avoid the restrictions that come with traditional income-based lending.

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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?


We offer lending services in all 50 states!

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Frequently Asked Questions

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

A DSCR loan (Debt Service Coverage Ratio loan) is an investor-focused financing option that uses a property’s rental income to determine loan eligibility—instead of relying on personal income, tax returns, or credit scores. Lenders assess whether the asset’s income can fully cover its debt service. This makes DSCR loans ideal for investors who want to scale with fewer financial hurdles. In Vermont, where STRs and seasonal rentals in places like Stowe, Burlington, and Montpelier are popular, this loan structure helps investors grow without traditional underwriting delays.

How is DSCR calculated in a typical loan scenario for Vermont investors?

In Vermont, DSCR is calculated by dividing a property's net operating income (NOI) by its total annual debt service, including mortgage payments, insurance, and taxes. For example, if a Vermont rental property generates $78,000 in NOI and carries $65,000 in debt service, the DSCR would be 1.20. That level of income coverage gives lenders confidence in the property’s financial stability. While Vermont lenders may accept a 1.00 DSCR, higher ratios—especially in markets like Burlington, Stowe, or Montpelier—can improve your loan terms. Understanding DSCR in Vermont helps investors assess whether their properties will meet lending standards and qualify for favorable financing.

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

Vermont investors should aim for a DSCR of 1.20 or above when applying for financing. Although a 1.00 ratio might pass basic underwriting, it doesn’t offer lenders much security. A 1.20 DSCR in Vermont shows that the rental property earns enough to exceed its debt service by 20%, which is especially important in seasonal markets like Stowe, Burlington, or Montpelier. Understanding what qualifies as a good DSCR in Vermont helps investors secure better loan terms and strengthen their long-term rental strategies.

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?

Vermont lenders approve DSCR loans by evaluating how much income a rental property can generate. Instead of reviewing tax returns or pay stubs, lenders in Vermont focus on lease agreements, market rent data, or short-term rental earnings. That income is then divided by the property’s annual debt service to calculate the DSCR. If the ratio is 1.00 or greater, Vermont borrowers may qualify—regardless of personal income. DSCR loans in Vermont are ideal for portfolio expansion and income-based financing. Understanding how rental income is evaluated in Vermont makes it easier to secure approval and scale efficiently.

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

In Vermont, most DSCR lenders require a minimum DSCR of 1.00. Some Vermont lenders may approve ratios as low as 0.75, but this typically requires excellent borrower qualifications. A DSCR of 1.20 or above is preferred in Vermont to secure better rates and avoid excessive reserve demands. DSCR loans in Vermont are popular among investors with seasonal or short-term rentals in markets like Burlington or Stowe. Understanding the minimum DSCR expectations in Vermont gives you the insight needed to build qualifying property deals with reduced underwriting friction.

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. DSCR loans in Vermont make it easy to qualify through rental income, especially for investors with non-traditional income sources. Whether managing properties in Burlington or vacation markets like Stowe, Vermont borrowers benefit from fewer documentation requirements and faster access to capital. Vermont investors appreciate the efficiency this financing model brings.

Expanding your rental portfolio beyond Vermont? We also offer financing in New Hampshire and New York , making it easy to scale across New England with the same asset-based approval process.