If you’re a real estate investor juggling multiple properties, you’ve probably heard of the Blanket DSCR loan. This unique loan type can simplify your portfolio financing and make cash flow management much easier. But is it right for you?
In this guide, I’ll walk you through what a Blanket DSCR loan is, its requirements, interest rates, how it compares to bridge loans, and where you can find the best lenders.
Key Takeaways:
- A Blanket DSCR loan lets investors finance multiple income properties under one mortgage.
- Qualification is based on property cash flow (DSCR), not personal income.
- Typical requirements include a DSCR of 1.0+, credit score of 660+, and ownership under an LLC.
- Interest rates usually range from 7.5% to 9.5%.
- Great for long-term rental portfolios; not ideal for short-term flips.
- Compare with bridge loans if you’re looking for short-term, transitional financing.
- Work with experienced blanket loan lenders to get the best terms.
What Is a Blanket Loan?
A blanket loan is a mortgage that covers multiple properties under one single loan agreement. Instead of applying for a separate loan for each rental or property, a blanket loan allows investors to finance or refinance multiple properties at once.
This strategy saves time, reduces paperwork, and can consolidate payments—making life a lot easier for real estate investors managing several units.
Bankrate explains blanket mortgages well, including how they’re typically used by investors or developers.
What Is a Blanket DSCR Loan?
A Blanket DSCR loan combines the power of a blanket mortgage with the flexibility of a DSCR (Debt-Service Coverage Ratio) loan.
DSCR loans are based on the property’s cash flow—not your personal income. When wrapped into a blanket structure, you can use the combined rental income of multiple properties to qualify.
This setup is perfect for investors who:
- Own or plan to buy 2+ income-generating properties
- Want to avoid income verification hassles
- Need quick and streamlined financing
Curious about no-money-down DSCR options? Check out this guide:
DSCR Loan with No Down Payment
Blanket DSCR Loan Requirements
Although requirements vary slightly by lender, here’s what you’ll usually need:
- Minimum DSCR: Often 1.0 or higher (some lenders accept lower)
- Portfolio of properties: 2 or more cash-flowing assets
- LLC or business entity: Many lenders require properties to be owned under a business
- Credit Score: Typically 660 or higher
- Appraisal: Each property may need its own appraisal
- Down Payment: Usually 20–25%, but alternatives exist
Want to understand if the pros outweigh the cons?
Read this breakdown: DSCR Loan Pros and Cons
Blanket DSCR Loan Interest Rate
The interest rate for a Blanket DSCR loan can range between 7.5% to 9.5%, depending on:
- Your DSCR
- Credit score
- Market conditions
- Type of property (short-term rental, multifamily, etc.)
- Loan term (30-year fixed or interest-only options)
Rates are typically a bit higher than traditional loans, but you’re getting the benefit of asset-based lending and consolidated financing.
For current rental loan rates, check out Rehab Lender’s rental loan page.
Blanket Loan vs Bridge Loan
Here’s a quick comparison of a Blanket loan vs Bridge loan:
| Feature | Blanket Loan | Bridge Loan |
|---|---|---|
| Purpose | Finance multiple properties at once | Short-term financing until long-term loan secures |
| Term | Usually long-term (up to 30 years) | Short-term (6–24 months) |
| Monthly Payments | Based on property income (DSCR) | Often interest-only or balloon payments |
| Exit Strategy | Refinance or sell some properties | Refinance or sell property |
| Risk | Losing one property can affect others | Default risk is property-specific |
If you’re flipping properties or need temporary funding, a bridge loan might be better. But for rental portfolios, blanket DSCR loans are more efficient and scalable.
Want a fast breakdown? Watch this short YouTube explanation.
Blanket Loan Lenders
Not every lender offers blanket DSCR loans, so it’s important to work with professionals who understand investor needs.
Top Blanket Loan Lenders include:
- LendSimpli
- Kiavi
- CoreVest
- Lima One Capital
- New Silver
We’ve put together a list of the best ones here:
Best DSCR Lenders
FAQs
How does a Blanket DSCR loan work?
This loan works by grouping two or more rental properties into one mortgage agreement. Instead of underwriting each property separately, lenders assess the overall DSCR of the portfolio. If the collective rental income sufficiently covers the debt payments, you’re approved. This approach allows you to use positive cash flow from stronger properties to offset weaker ones, making approval easier and faster.
What are the main benefits of a Blanket DSCR loan?
The primary benefits include simplified management, faster approvals, and access to scalable capital. By eliminating the need for multiple loan applications and income verification, investors save time and reduce red tape. Plus, using DSCR as the qualifying metric allows those with strong property cash flows—but complex personal finances—to still secure funding.
What are the typical Blanket DSCR loan requirements?
Most lenders require a DSCR of at least 1.0, meaning the property’s income covers its debts. Additional criteria often include a minimum credit score of 660, ownership through an LLC or entity, and property appraisals. A down payment of 20–25% is common, although no-down-payment DSCR options are emerging in the market.
What is considered a good DSCR for a Blanket loan?
A DSCR of 1.25 or higher is generally seen as strong, indicating that your rental income is 25% more than your mortgage obligation. While some lenders may accept a DSCR as low as 1.0, higher ratios improve your chances of better interest rates and larger loan amounts.
How is the interest rate for a Blanket DSCR loan determined?
The Blanket DSCR loan interest rate typically ranges from 7.5% to 9.5%, depending on your DSCR, creditworthiness, property location, and loan structure. Lenders evaluate the risk profile of your portfolio as a whole, so properties with consistent rent and low vacancy can lead to more favorable rates.
Can I refinance with a Blanket DSCR loan?
Yes, refinancing is one of the most strategic uses of a Blanket DSCR loan. Investors often refinance multiple properties into a single loan to consolidate payments, tap into equity, or extend loan terms. This is especially helpful if you’re holding several loans with varying interest rates or balloon payments.
What’s the difference between a Blanket loan and a Bridge loan?
A Blanket loan is long-term financing for multiple properties, while a Bridge loan is short-term and used during transitional periods—like buying a new property before selling an existing one. Blanket DSCR loans are better for rental income portfolios, while bridge loans work for time-sensitive transactions or flips.
Who are the best Blanket loan lenders in the market?
Top Blanket loan lenders include LendSimpli, CoreVest, Lima One Capital, and New Silver. Each offers different terms, rates, and loan structures. For a comprehensive comparison of trusted lenders, check out our updated list of the best DSCR lenders.
Can I get a Blanket DSCR loan as a first-time investor?
While possible, it’s more common for experienced investors with at least two rental properties. First-timers might face stricter underwriting and higher rates, as lenders see them as higher risk. However, strong DSCRs and clean credit can still get you approved, especially with non-bank lenders.
Do all properties in a Blanket loan need to be in the same location?
Not necessarily. Many lenders allow properties across different states or cities, as long as they meet income and valuation criteria. However, managing far-flung properties can be complex, so it’s essential to work with a lender that understands multi-market investing.
Can I sell one property from a Blanket DSCR loan?
Yes, but with conditions. Most Blanket loans include a release clause that allows you to sell one property without refinancing the entire loan. You’ll typically need to pay down a portion of the loan or meet specific DSCR thresholds after the sale. Always confirm this with your lender before signing.
What happens if one property in the loan underperforms?
One of the key benefits of a Blanket DSCR loan is that the portfolio’s overall cash flow matters more than individual properties. A property that underperforms can be balanced out by those performing well. However, consistent underperformance may eventually affect your ability to refinance or maintain favorable terms.
Is personal income required for a Blanket DSCR loan?
No, and that’s the beauty of it. These loans are based on property income, not your W-2 or tax returns. This is ideal for self-employed investors, business owners, or those with complex tax structures who might struggle with traditional income verification.
Where can I learn more about how DSCR loans work?
Start by watching a quick explainer video for a 60-second overview. Then dive deeper with in-depth articles on DSCR loan pros and cons and no-down-payment options. These resources provide everything you need to make an informed decision.
Final Thoughts
A Blanket DSCR loan is a great financing strategy for serious real estate investors. It allows you to bundle multiple properties under one loan, qualify based on cash flow, and keep your personal income off the table.
While the interest rates can be slightly higher, the convenience and flexibility often make it worth it.
Before you commit, make sure to:
- Review the blanket DSCR loan requirements
- Compare the blanket DSCR loan interest rate
- Understand how it compares in the blanket loan vs bridge loan debate
- Explore options from top blanket loan lenders
Need help calculating if a DSCR loan is right for your portfolio? Use our free calculator at dscrloancalculator.online.