I. Overview of Tidal Loans’ Rental Loan/DSCR Loan Program in California
Tidal Loans’ Debt Service Coverage Ratio (DSCR) loans empower California real estate investors to finance or refinance rental properties using the asset’s cash flow—not personal income. Whether you’re investing in Los Angeles’ competitive market, San Diego’s vacation rentals, or Sacramento’s suburban neighborhoods, our program offers flexibility for long-term wealth-building.
Key Property Types Funded:
Single-family homes
Multifamily units (2-4+ and 5+ units)
Mixed-use buildings
Short-term rentals (Airbnb/VRBO)
Why California?
California’s dynamic real estate market—from Silicon Valley’s tech-driven demand to Palm Springs’ vacation rental boom—requires agile financing. With home prices averaging $800K+, investors need lenders who prioritize cash flow over personal income. Tidal Loans bridges this gap, offering tailored solutions for high-cost markets.
II. DSCR Loan Meaning and Basics in California
What is a DSCR Loan?
A Debt Service Coverage Ratio (DSCR) loan evaluates a property’s ability to cover its mortgage payments using rental income. This non-QM loan is ideal for investors who:
Own multiple properties.
Have irregular income (e.g., self-employed or foreign nationals).
Focus on short-term rentals (Airbnb/VRBO).
DSCR Formula:
DSCR = Net Operating Income (NOI)Total Debt Service
DSCR = Total Debt Service
Net Operating Income (NOI)
Example:
A Los Angeles triplex generating
7,500/month rent with
7,500/month in rent with6,000/month in debt payments has a DSCR of 1.25. This qualifies for competitive rates.
Key Features of California DSCR Loans
💸 Approval Based on Cash Flow: Qualify using rental income—no personal income verification needed.
📝 No Tax Returns Needed!
🕰️ No Seasoning Requirements: Cash-out refinances are possible without title seasoning if the property is renovated. (BRRRR strategy).
🌎 Foreign Nationals Welcome: We offer DSCR Loan solutions for foreign nationals with an LTV adjustment and extra reserves.
💰 Investment Property Down Payment: Start with as little as 20% down, plus closing costs.
📈 Interest-Only Option: Maximize cash flow with 10 years of interest-only payments, stability in volatile markets like San Francisco followed by 20 years amortized at the same rate—no ARM surprises.
📉 Low DSCR Ratio Minimum: We offer DSCR loans with a minimum DSCR of 0.75 and even provide no DSCR loan options for select deals.
🔑 Low Minimum Credit Score: Borrowers with FICO scores as low as 500 are eligible.
🏠 Short-Term Rental Financing: For short-term rental properties, we use short-term market rental rates instead of traditional rates to calculate the DSCR ratio.
🏢 Entity Vesting: Secure your loan in your LLC or business name. Our DSCR Loan Florida won’t appear on your personal credit report, unlike conventional rental loans.
🏚️ Vacant Properties & Unoccupied Refinances: While an executed lease is preferred, we fund rent-ready properties without one.
🆕 Experience: First-time investors are welcome!
💸 Airbnb Financing: Use short-term rental market rates for properties near theme parks.
III. DSCR Ratio and Requirements in California
How to Calculate DSCR for California Properties
Net Operating Income (NOI):
For long-term rentals: Subtract vacancy rates, property taxes, insurance, and maintenance from gross rent.
For short-term rentals: Use projected Airbnb income (e.g., $15,000/month for a Palm Springs vacation home).
Total Debt Service:
Mortgage principal + interest + taxes + insurance + HOA fees.
California-Specific DSCR Requirements:
Criteria | Requirement |
Minimum Credit Score | 500 |
Minimum DSCR Ratio | 0.75 (Lower ratios qualify with adjusted terms) |
Property Types | Single-family, multifamily, commercial, rural |
Up to 80% (Higher LTV for DSCR 1.25+) |
Flexibility for Unique Scenarios:
Low DSCR? A San Diego condo with a 0.80 DSCR might qualify at 70% LTV.
No Lease? Fund rent-ready properties without active tenants.
IV. Benefits of DSCR Loans in California
1. Short-Term Rental Financing
California’s top Airbnb markets—Los Angeles, Lake Tahoe, Big Bear, and Joshua Tree—thrive with our DSCR loans. We use short-term rental income projections instead of traditional leases, ideal for vacation hotspots.
2. High-Cost Market Solutions
Finance $1M+ properties in San Jose or Beverly Hills with competitive rates and 30-year terms.
3. Entity Vesting & Portfolio Growth
Hold loans in your LLC’s name to protect personal credit and scale effortlessly.
4. Foreign Nationals Welcome
International investors can secure loans with adjusted LTV and reserve requirements.
V. How to Apply for a DSCR Loan in California
Step-by-Step Process
Submit Property Details: Share address, rent projections, and renovation plans.
Instant Pre-Approval: Receive a term sheet within 24 hours.
Underwriting: We analyze cash flow, credit, and DSCR.
Close in 7-14 Days: Fast-track closings with no appraisal delays (bridge loans).
VI. Airbnb Financing in California
California’s short-term rental market generates billions annually. Tidal Loans simplifies Airbnb financing by:
Using market-based STR income (e.g., $25,000/month for a Malibu beach house).
Offering 30-year fixed terms to stabilize cash flow in seasonal markets.
VII. Why Partner with Tidal Loans in California?
1. Speed & Efficiency
Close loans as fast as 7 business days after we receive a full file with our in-house underwriting team.
2. 50+ Years of California Expertise
We’ve funded properties from San Diego’s coastline to Redding’s rural estates.
3. BRRRR Strategy Support
Pre-approve refinancing during renovations—ideal for LA fixer-uppers.
VIII. DSCR Loan FAQs for California Investors
Q: Can I finance a property with a tenant already in place?
A: Yes! Active leases are optional—we fund rent-ready properties that are vacant as well.
Q: Do you require tax returns for LLC-owned properties?
A: No. Approval is based on the property’s cash flow, not your personal taxes.
Q: What’s the minimum loan amount?
A: $75,000
IX. Call to Action for California Investors
Ready to unlock California’s rental market potential? Apply for a DSCR loan today or GET A FREE QUOTE to get started.
