DSCR (DSCR Service Coverage Ratio) loan in Colorado offers a flexible financing solution for real estate investors who may not qualify for traditional mortgages. These loans focus on a property’s income potential rather than personal income, making them ideal for expanding your rental portfolio.
With more straightforward qualification requirements and greater availability, DSCR loans provide a streamlined path to investment success. If you’re looking to build wealth through rental properties, a Colorado DSCR loan could be the key to unlocking new opportunities.
Ready to invest in DSCR loans in Colorado? Apply for a DSCR loan in Colorado today!
Key Takeaways:
➡️DSCR loans are ideal for expanding rental portfolios, acquiring multiple properties, or leveraging cash-out refinancing—suitable for self-employed individuals in Colorado.
➡️No W2s, pay stubs, or tax returns required—skip extensive documentation and get approved quickly by focusing on the property’s cash flow.
➡️Enjoy competitive interest rates, higher LTV ratios, and customizable repayment options tailored for investment properties with HomeAbroad’s DSCR loan.
➡️DSCR loans focus on property rental income, not personal income, making them ideal for investors with non-traditional income sources.
Table of Contents
What are DSCR loans?
A DSCR (Debt Service Coverage Ratio) loan allows real estate investors to finance properties without personal income verification, relying instead on the property’s rental income to qualify.
In Colorado, where rental demand remains strong, and cities like Denver and Colorado Springs offer steady appreciation and rental yields, investors can acquire properties that cover their mortgage while generating positive cash flow. This makes DSCR loans a powerful tool for growing a real estate portfolio in Colorado’s competitive market.
How to Calculate Your DSCR Ratio
The Debt Service Coverage Ratio (DSCR) is a key metric that lenders use to determine whether a rental property generates enough income to cover its mortgage payments.
If you’re a real estate investor in Colorado, understanding and calculating your DSCR ratio can help you quickly secure the best loan terms and expand your investment portfolio.
The formula for calculating DSCR is:
Let’s apply the DSCR formula using a real-world example of a rental property in Denver, Colorado:
Example
Calculating the DSCR Ratio for a Colorado Property:
How DSCR Matters
- A DSCR of 1.23 means the property generates 23% more income than its total loan obligations, indicating positive cash flow and strong investment potential.
- While most lenders require a DSCR of 1.0 or higher, HomeAbroad offers DSCR loans for properties with a DSCR as low as 0.75, allowing investors more flexibility.
DSCR Loan Interest Rates
Due to the unique nature of DSCR loans and the associated increased risk for lenders, these rates are typically 1% to 1.5% higher than conventional mortgage rates.
Understanding these rates is crucial for investors, as they significantly impact the profitability of investment properties. Before investing, follow our DSCR loan interest rate guide to learn about current DSCR loan interest rates and their influencing factors. For more details on DSCR loans and how they work, visit HomeAbroad’s DSCR loan hub.
How to Qualify for a DSCR Loan in Colorado
At HomeAbroad, we make qualifying for a DSCR loan simple and flexible, whether you’re a domestic investor or a foreign national. Now, let’s learn about our tailored DSCR loan requirements to provide domestic and foreign investors with flexible financing solutions.
| Features | Domestic Investors | Foreign Investors |
|---|---|---|
| DSCR Ratio | 1 or Higher (No Ratio DSCR Program Available) | >= 1 for best terms, <1 eligible with higher down payment |
| Credit Score | 620 or higher | No US credit history required |
| Down Payment | 20% | 25% |
| Loan-to-Value (LTV) | Up to 80% for purchase/refinance Up to 75% for cash-out refinance | Up to 75% for purchase/refinance Up to 70% for cash-out refinance |
| Cash Reserves | 2 months | 6 months |
| Property Use | Investment properties (residential and commercial) | Investment properties (residential and commercial) |
| Loan Amount | $75K – $10M | $75K – $10M |
⚠ No Ratio DSCR Loans are available for properties with DSCR <1, requiring a higher down payment but allowing financing for underperforming or transition properties.
Areas We Lend in Colorado
Investing in Colorado’s real estate market offers promising opportunities for high rental yields and property appreciation. Here are some top areas to consider:
- Denver
- Colorado Springs
- Aurora
- Fort Collins
- Boulder
- Thornton
- Arvada
- Westminster
- Pueblo
- Greeley
- Longmont
- Loveland
- Castle Rock
- Grand Junction
Let’s evaluate a case study of our past client to understand how profitable investing in the Colorado real estate market is.
Case Study: David Expands His Rental Portfolio in Colorado
Property Details:
Location: Denver, Colorado
Property Price: $500,000
Monthly Rent: $4,200
Loan Details:
Loan Amount: $400,000
Down Payment: 25%
Monthly PITIA: $3,375
DSCR Calculation:
DSCR Ratio = Gross Rental Income ÷ PITIA
DSCR = $4,200 / $3,375
DSCR = 1.24
Client: David Thompson
Advisor: Steven Glick, Director of Mortgage Sales, HomeAbroad (NMLS# 1231769)
David Thompson, an experienced real estate investor from California, wanted to expand his rental portfolio by purchasing a single-family property in Denver. He aimed to acquire a high-performing investment while keeping his income separate from his real estate finances.
David worked with Steven Glick, an expert in debt service coverage ratio (DSCR) loans, to achieve this. Steven structured a financing solution that relied solely on the property’s income potential, eliminating the need for traditional income verification.
The HomeAbroad Solution
A DSCR of 1.24 means that the property’s rental income exceeds its debt obligations by 24%, ensuring positive cash flow of $825 and a substantial investment.
This strategy allowed David to expand his rental portfolio successfully, leveraging the property’s income potential without using his income for qualification.
Why This Matters?
Steven Glick highlights the importance of this financing approach:
By focusing on the property’s income rather than personal earnings, DSCR loans open a streamlined pathway for investors. In Denver’s thriving rental market, this strategy allowed David to secure his investment confidently and maintain financial separation.
Steven Glick, Director of Mortgage Sales, HomeAbroad
This case underscores the power of DSCR loans in enabling real estate investors to scale their portfolios efficiently. With expert guidance and tailored financing, David successfully entered one of the nation’s most dynamic rental markets—without the usual income verification roadblocks.
DSCR loans provide an effective, results-driven solution for investors looking to grow their holdings with minimal financial entanglements.
Top Places to Invest in Colorado with DSCR Loan
Colorado offers a strong real estate market with attractive rental yields, making it a prime investment opportunity. With an average home price of around $500,000—higher than the national average of $355,328—investors benefit from steady property appreciation and strong rental demand.
Thanks to top universities and booming industries, cities like Denver, Boulder, and Fort Collins attract long-term demand from students and professionals. Meanwhile, Colorado Springs, Breckenridge, and Aspen thrive on tourism, creating excellent short-term rental potential.
With Colorado’s solid rental yields and access to DSCR loans, investors can secure properties that cover their mortgage and generate positive cash flow.
Here are some top investment cities in Colorado:
City | Rental Type | Rental Yield |
|---|---|---|
Lake George | Short-Term | 11.5% |
Florissant | Long-Term | 10.9% |
Guffey | Short-Term | 9.8% |
Hartsel | Short-Term | 10.2% |
Jefferson | Short-Term | 10.7% |
Woodland Park | Long-Term | 9.8% |
Need help finding the right investment property? Our AI-driven investment property search platform can help you discover high-performing rentals in Colorado or anywhere in the US!
Get a HomeAbroad DSCR loan in Colorado
HomeAbroad simplifies US real estate investment for international buyers with tailored DSCR loans. Whether you’re targeting short-term rentals in Denver, multifamily properties in Colorado Springs, or single-family homes in Aurora, our flexible financing helps you expand quickly.
As a one-stop PropTech and FinTech platform, we offer foreign national mortgages, AI-powered property search, and access to 500+ expert agents for personalized guidance. Our comprehensive concierge services cover LLC formation, US bank accounts, insurance, and property management, ensuring a seamless investment experience.
With expert-backed DSCR loans and full-service support, investing in Colorado’s booming market has never been easier. Apply now and get a DSCR loan in Colorado with HomeAbroad.
FAQs
Can foreign nationals apply for DSCR loans in Colorado?
Foreign nationals can apply for DSCR loans through HomeAbroad Loans without needing a US credit score, making it a flexible financing option for international investors.
Is cash-out refinancing available for DSCR loans?
HomeAbroad Loans offers cash-out refinancing options for DSCR loans, allowing investors to extract equity from their properties for further investments or renovations.
How long does it take to get a DSCR loan in Colorado?
At HomeAbroad Loans, we streamline the application process, ensuring a smooth experience from loan application to closing. We guarantee that the closing will happen within 30 days.
At HomeAbroad, we ensure the reliability of our content by relying on primary sources such as government data, industry reports, firsthand accounts from our network of experts, and interviews with specialists. We also incorporate original research from respected publishers when relevant. Discover more about our commitment to delivering precise and impartial information in our editorial policy.
Airdna: Rental Data
Zillow: Home Prices
How Does HomeAbroad Help?
"Unlocking US real estate for the world with our tailored offerings."
DSCR Loans
Fix and Flip Loan 
Bridge Loan
Real Estate Agent ![DSCR Loan Florida [2025]: Qualify with Your Property’s Income](https://homeabroadinc.com/wp-content/uploads/2022/09/DSCR-Loan-Florida.png)
![DSCR Loan in Texas: Qualify with Rental Income [2025]](https://homeabroadinc.com/wp-content/uploads/2023/01/DSCR-Loans-Texas.jpeg)
