DSCR Loans in Texas
3 lenders, 1.80% property tax, $1,650/mo median rent. Landlord-friendly state.
Market Snapshot
Estimated DSCR assumes median price, median rent, 75% LTV, 30-year fixed at 7.45%, property tax and insurance only. Your deal will differ.
The Texas Rental Market
Houston and DFW dominate DSCR volume. High property taxes eat into NOI but strong rents and population growth offset it. Austin has compressed cap rates.
Top markets in Texas
- Houston
- Dallas-Fort Worth
- San Antonio
- Austin
How Texas Costs Affect Your DSCR
Two line items determine whether a Texas rental hits DSCR thresholds: property tax and insurance. Together they represent the bulk of operating expenses in a DSCR calculation (which excludes management fees and capital expenditures).
Property tax: 1.80%
Texas's property tax rate is above the national average of roughly 1.1%. On a $295,000 property, you pay approximately $443/month in property taxes. This can significantly impact your DSCR, especially on lower-rent properties.
Insurance: $2,450/year
Insurance in Texas runs about $2,450/year ($204/month), which is manageable. Rates can vary by city, property age, and condition. Get a real quote for your specific property.
Combined impact
On a median-priced Texas property, property tax plus insurance runs approximately $647/month. Subtract that from the $1,650 median rent, and your NOI is roughly $1,003/month before the mortgage payment. Run your own numbers in the DSCR calculator to see exactly where your deal lands.
DSCR Lenders in Texas
3 lenders in our database cover Texas. All major DSCR lenders operate in Texas. High property taxes mean you need stronger gross rents to hit 1.25 DSCR. Insurance costs spiked in 2024-2025 in coastal areas.
| Lender | Min DSCR | Min FICO | Max LTV | STR |
|---|---|---|---|---|
| Visio Lending | 1.00 | 680 | 80% | Yes |
| Griffin Funding | 0.75 | 660 | 80% | Yes |
| Truss Financial Group | N/A | N/A | 75% | N/A |
See the full lender comparison matrix for all columns, or use the DSCR qualifier to find which lenders match your specific deal.
Landlord-Tenant Climate
Texas is generally considered a landlord-friendly state. No rent control statewide, eviction timeline typically 30-45 days, no mandatory relocation assistance.
Landlord-friendliness matters for DSCR investors because extended vacancies and eviction costs eat into the rental income that your DSCR depends on. A state where evictions take 3 months versus 3 weeks changes the effective vacancy factor in your underwriting.
Example Deal: Median Texas Property
To show how these numbers interact, here is a simplified underwrite of a median-priced Texas rental at current rates:
| Purchase price | $295,000 |
| Loan amount (75% LTV) | $221,250 |
| Rate (30yr fixed) | 7.45% |
| Monthly payment (P&I) | $1,539 |
| Monthly rent | $1,650 |
| Property tax | $443/mo |
| Insurance | $204/mo |
| NOI (rent minus tax and insurance) | $1,003/mo |
| DSCR | 0.65 |
The median deal falls short of the 1.0 DSCR minimum. You need to find properties with significantly above-median rents or below-median prices to make DSCR financing work in this market. Plug your actual numbers into the DSCR calculator.
Tools for Texas Investors
- DSCR Calculator - Check if your Texas rental qualifies
- Cash-Out Refi Calculator - Model a refinance on an existing Texas property
- DSCR Qualifier - Match your deal against lenders in Texas
- Lender Matrix - Compare all lenders side by side
- Rate Monitor - Track current DSCR rates weekly
- Rental Property Analyzer - Full deal analysis with NOI, cash flow, and ROI
FAQ
Can I get a DSCR loan in Texas?
Yes. 3 of the major DSCR lenders in our database operate in Texas. DSCR loans are available in all 50 states, though some lenders exclude specific states. Texas is one of the more active DSCR markets.
What DSCR do I need for a rental property in Texas?
Most lenders require a minimum DSCR of 1.0 to 1.25. Texas's high property tax rate (1.80%) hurts your DSCR compared to the national average. On a median-priced Texas property, the estimated DSCR is around 0.65 at current rates.
What are property taxes in Texas?
The average effective property tax rate in Texas is 1.80%. On a $295,000 property, that is roughly $5,310/year or $443/month. This directly reduces your NOI and DSCR.
How much is rental property insurance in Texas?
The average annual insurance premium for a rental property in Texas is approximately $2,450. This is near or below the national average, which helps your DSCR.
Is Texas a good state for rental property investing?
Texas is generally considered landlord-friendly. No rent control statewide, eviction timeline typically 30-45 days, no mandatory relocation assistance. The best markets in Texas for DSCR investors are Houston, Dallas-Fort Worth, San Antonio.
Which DSCR lenders work in Texas?
Our database shows 3 DSCR lenders operating in Texas. Most national lenders cover Texas. Check our lender comparison matrix for specific lender requirements and filter by state.
What is the median rent in Texas?
The median rent for a single-family rental in Texas is approximately $1,650/month. Actual rents vary widely by market: Houston may be higher or lower than Austin. Always use actual rental comps for your specific property and neighborhood.