San Francisco DSCR loans at a glance
You want to buy a rental in the city and need a quick read on what lenders ask. The table shows typical market ranges, plus the local costs that matter most. For the statewide picture, see our page on DSCR loans in California.
| Item | What lenders typically ask |
|---|---|
| How you qualify | On the rent the property brings in, compared with the full monthly payment |
| Usual ratio floor | 1.0, meaning the rent at least matches the payment |
| Ratio under 1.0 | Some lenders accept about 0.75, or set no minimum, usually at a maximum LTV of 70% to 75% |
| Down payment on a purchase | 20% to 30% |
| Credit score | 620 to 700 minimum, many lenders at 660 to 680 |
| Reserves after closing | 3 to 12 months of the full monthly payment |
| Property | Single family homes, condos, townhomes and buildings of 2 to 4 units |
| Condos | The lender reviews the HOA; non-warrantable condos go to fewer lenders, often with 25% to 30% down |
| City transfer tax | $3.75 per $500 of price from $1 million to under $5 million (city rate table) |
Market ranges as of October 2026, drawn from published lender guidelines and industry guides. The transfer tax row comes from the city's published rate table. Advanced Funding Solutions is a broker and does not set these numbers. The lender that funds your loan sets your actual terms.
How a DSCR loan works
If you buy rentals, your tax returns may not show the income a lender wants to see. A DSCR loan judges the property instead. DSCR stands for debt service coverage ratio: the monthly rent divided by the full payment, which covers principal, interest, property tax, insurance and any HOA dues.
A ratio of 1.0 means the rent covers the payment exactly. A ratio of 1.2 means it covers the payment with 20% to spare. The rent figure comes from your lease, from the appraiser's estimate of market rent, or often the lower of the two. You can test your own numbers in our DSCR calculator.
These are business purpose loans for rentals, so they are not for a home you plan to live in. For the full overview, see our page on DSCR loans.
What lenders typically look for
Your credit, your cash and the rent decide where you land in the market range. Most lenders look for a credit score of at least 620 to 700, with many setting the line near 660 to 680. Pricing tends to improve above 700.
On a purchase, most lenders ask for 20% to 30% down, which is a maximum LTV of 70% to 80%. LTV means loan to value: the loan as a share of the price. After closing, lenders typically want 3 to 12 months of the full payment left in your account as reserves.
Rates on DSCR loans usually run higher than on a conventional loan, and they move with your score, your down payment and the ratio. The full checklist lives in our guide to DSCR loan requirements in California.
Which properties qualify
You can use a DSCR loan on most rentals you would buy in the city. That includes a single family home, a condo, a townhome, or a building with 2 to 4 units. On a small building, the appraiser estimates market rent for each unit on Fannie Mae Form 1025, and the lender counts rent from all of them.
A building with 5 or more units usually moves to a commercial loan. Short term rentals depend on two things: whether the lender counts nightly income, and whether the city's short term rental rules allow your plan. Our guide to DSCR loans for short term rentals covers how lenders treat that income.
Buying a condo with a DSCR loan
If you are shopping for a rental condo, the lender looks at the building as well as your unit. The HOA or its management company fills out a questionnaire covering the budget, reserves, unpaid dues, insurance and any lawsuits. A slow reply from the management company is a common reason for a delay, so it helps to ask for it early.
That review sorts the building into warrantable or non-warrantable. A warrantable condo meets the standard Fannie Mae and Freddie Mac project rules. A non-warrantable one misses them, often because of a high share of investor owners, low HOA reserves, pending litigation, commercial space or short term rentals in the building.
Many DSCR lenders still finance non-warrantable condos, but fewer of them do it, and they usually ask for more down. That is why condo buyers here benefit from comparing lenders before writing an offer. A building that one lender turns down may be fine with another.
Why the rent may not cover the payment
You may find that a rental here covers less of its payment than you expected. Market reports put the city's median sale price near $1.5 million in early 2026, and rents have not kept the same pace. California also resets the property tax base when a home sells, so your tax bill follows the price you pay.
Say you buy a $1,500,000 rental that brings in $7,000 a month. These are round numbers for teaching, not a quote and not a real listing.
| Item | Amount |
|---|---|
| Down payment at 25% | $375,000 |
| Loan amount | $1,125,000 |
| Rent | $7,000 a month |
| Full monthly payment (assumed for this example) | $9,200 |
| Ratio | 0.76 |
| Gap you cover each month | $2,200 |
A ratio under 1.0 means you pay the difference from your own pocket every month. To reach 1.0 here, the payment would need to fall to $7,000, or the rent would need to rise to $9,200.
Your options when the ratio is under 1.0
You have a few ways to make a low ratio work, and many investors combine two of them. Each one trades something: more cash now, a higher price on the loan, or a slower payoff.
- A lender that accepts a lower ratio: some take a ratio near 0.75, and a few set no minimum, usually with a maximum LTV of 70% to 75% and higher pricing.
- A larger down payment: in the example, 35% down cuts the payment by about $1,000 a month and lifts the ratio to about 0.85. Our guide to DSCR loan down payments covers where that cash can come from.
- An interest only period: paying only interest for the first years lowers the payment. Lenders differ on which payment they use to figure the ratio, so ask before you count on it.
- Paying points to lower the rate: this makes sense when you plan to hold for years. Ask how many months of lower payments it takes to earn the points back.
Because we compare 100+ wholesale lenders, we can see which of them take a ratio like yours and what each one asks in return.
Rent control and tenants already in place
If you buy a rental with a tenant already living there, you take over the lease and the rent. The city's rental law guide says many units in buildings built on or before June 13, 1979 have both rent control and eviction protection. Most single family homes and condos are not under rent control when the tenant moved in on or after January 1, 1996, though eviction protection can still apply.
This matters because many DSCR lenders count the lower of the signed lease and the appraiser's market rent. A long tenancy at a low rent can hold the ratio down for years, since rent control limits each increase to the yearly amount the city's Rent Board allows. It is worth reading every lease before you set your price.
Transfer tax and your cash to close
Your cash to close here includes the city's real property transfer tax. The city publishes the rate as a dollar amount for each $500 of the price, and the rate depends on the price band.
- Over $250,000 and under $1 million: $3.40 per $500
- $1 million to under $5 million: $3.75 per $500
- $5 million to under $10 million: $11.25 per $500
On the $1,500,000 example, that comes to $11,250. Your purchase contract settles who pays it, so ask your agent how it is usually split. These are the city's posted rates as of October 2026.
Add that to the down payment, closing costs and the reserves most lenders want in your account after closing. With a ratio under 1.0, it is worth keeping extra cash on top of reserves to cover the monthly gap.
When a DSCR loan is the wrong fit in San Francisco
If you plan to live in the home, or in one unit of a small building, a DSCR loan is not the right tool. An owner occupied loan usually asks for less cash down. If your tax returns show steady income, a conventional investment loan usually costs less than a DSCR loan, so take it.
A deep gap is the other warning sign. If the ratio sits near 0.7 and you cannot carry the monthly shortfall through a vacancy or a repair, a lower price or a different property is the safer path.
Talk through a rental with us
You do not have to work out the ratio and the lender list alone. Advanced Funding Solutions is a California mortgage brokerage with 25 years of mortgage experience, and we work with 100+ wholesale lenders. We look at the rent, the property and your cash, then show you which lenders fit, and the lender you choose approves and funds the loan.
The first call covers the price, the rent and what you plan to put down. Call (818) 478-2555, or request a quote online.
For how these loans work across the state, see DSCR loans in California.
Frequently Asked Questions
What is the lowest DSCR ratio a lender will accept?
Usually 1.0, though not always. As of October 2026, some lenders in the market accept a ratio near 0.75, and a few set no minimum at all. Those loans tend to come with a maximum LTV of about 70% to 75%, which means 25% to 30% down, and pricing that costs more each month.
Can I buy a condo in a building full of renters with a DSCR loan?
Often, yes, at fewer lenders. A building with a high share of investor owners can fail the standard condo review and be labelled non-warrantable. Some DSCR lenders still finance those units, usually with a larger down payment. The HOA questionnaire tells the lender which group the building falls into.
Will a DSCR lender finance a TIC unit?
Usually not. TIC means tenancy in common: you buy a share of the whole building, not a unit with its own deed. Few investors buy those loans, so a small group of mostly local lenders handles them, often with a larger down payment. If a TIC is the only way your numbers work, ask us before you sign a contract.
Does a vacant unit help or hurt my ratio?
It can help. With no lease in place, lenders usually rely on the appraiser's estimate of market rent for that unit. When the tenants in place pay below market, a vacant unit at market rent can lift the ratio. The appraiser still has to support the number with nearby rentals.
How much is the transfer tax on a $1.5 million rental?
About $11,250. The city's published rate for a price from $1 million to under $5 million is $3.75 for each $500 of the price, which works out to $11,250 at $1.5 million. Your purchase contract settles who pays it, so ask your agent how it is usually split.
Advanced Funding Solutions Inc. is a licensed mortgage brokerage, not a lender. NMLS #1277693. CA DRE #01973518. Consumer mortgage loans are licensed in California and Florida; DSCR loans are business purpose loans. All loans are subject to credit, income, asset, property, and underwriting approval. The funding lender sets rates, terms and conditions, which can change without notice. Market ranges on this page are typical industry figures as of October 2026, not an offer or a commitment to lend. Transfer tax figures are from the City and County of San Francisco's published rate table and can change. Equal Housing Opportunity.