A DSCR loan, or Debt Service Coverage Ratio loan, is a type of mortgage used by real estate investors to purchase property without having to show proof of income. Instead, lenders use the propertys cash flow to determine the borrowers ability to repay the loan. DSCR loans are designed for investors only, not for purchasing a primary residence. The loans are made by looking at the potential income that a property could bring, instead of the income that an investor is making right now. DSCR loans are one of several types of home loans referred to as Non-QM loans. Non-QM loans provide potential borrowers with an alternative route to financing, which doesn’t require traditional income verification methods. DSCR loans enable real estate investors to get a loan because it takes into account cash flow from investment properties rather than pay stubs or W-2s, which many investors do not typically have. DSCR loans are attractive to real estate investors because they provide a way to finance investments without putting a large amount of money down.