Investment Property Loans in Washington, Oregon and Idaho

In brief:

• Conventional investor loans finance one to four unit rentals, qualifying on your income and debts, with part of the rent counted.
• DSCR loans qualify on the debt service coverage ratio: the property's rent compared with the full payment.
• Non-QM loans use bank statements, assets or other documentation for borrowers whose tax returns understate their income.
• Jumbo financing covers loan amounts above the conforming limit.

FHA, VA and USDA loans are for homes you live in, but FHA and VA can finance a two to four unit property where you live in one unit and rent the others.

Fannie Mae and Freddie Mac set lower maximum loan-to-value ratios for investment properties than for homes you occupy, and apply loan-level price adjustments that raise the cost. DSCR loans typically need 20% to 25% down, with pricing that improves as the coverage ratio and equity go up.

Lenders also look for reserves, measured in months of payments, and the requirement grows as you add financed properties. See Fannie Mae's guidance on multiple financed properties (opens in a new tab).

Fannie Mae's rental income guidance (opens in a new tab) explains the general approach: lenders typically use a percentage of gross rent (often 75%) to allow for vacancy and maintenance, or the net figure from your tax returns if you already own rentals.

For a DSCR loan, the lender divides the monthly rent by the full payment (principal, interest, taxes, insurance and HOA dues). Ratios of 1.0 or higher are generally required, and higher ratios open up more competitive terms. Try the DSCR calculator with your numbers.

Short-term rental income is easier to use once you have a history of it on your tax returns. If nightly rentals are central to your plan, a DSCR loan may fit better.

Local rules matter too. Cities and counties across Washington, Oregon and Idaho set their own permits, occupancy limits and zoning for short-term rentals, and HOAs can restrict them. Confirm what is allowed at the address, and whether a permit transfers, before you buy. Insurance for a short-term rental is also different from a standard policy.

DSCR and non-QM loans are not one product; terms vary a lot from lender to lender. Prepayment penalties, minimum loan amounts, reserve rules and how short-term rent is treated all differ. Comparing a DSCR quote with a conventional investment quote side by side is the fastest way to see which one costs less for your situation.

To compare options for a specific property, start a quote or schedule a call. Any figures before underwriting are estimates only, not a commitment to lend.