Question 1

Who actually rents in Midland-Odessa, and how should that shape my underwriting?

Accepted Answer

Mostly the oilfield workforce, and that tenant base moves with the drilling cycle, not the calendar. The Midland MSA posted 2.9% unemployment in April 2026, the lowest of any metro in Texas against a 4.0% state average, with Diamondback Energy, the largest pure-play independent operator in the Permian, headquartered in Midland. In past booms the labor force outgrew housing fast enough that employers put crews in RV lots and temporary housing while rents spiked; when a bust hits, that demand thins out first. That history is a reason to underwrite to a durable, collected rent rather than a boom-year number. Run your own numbers with the DSCR calculator.

Question 2

How big a rent swing should I underwrite in this metro?

Accepted Answer

Bigger than almost anywhere else in Texas. The Zillow Observed Rent Index shows Midland MSA rent falling from $1,571 in June 2019 to $1,158 during the 2020-21 oil-crash trough, a peak-to-trough drop of about 26%, before recovering to a June 2025 peak of $1,680. As of June 2026 rent sits at $1,620 in Midland and $1,551 in Odessa, down 3.6% and 4.0% year over year. A DSCR loan sized on the 2025 peak rent is a different loan than one sized on the 2020 trough rent, and this metro is the one place in our footprint where that gap has actually happened. We size to what the property collects today, not the best month it ever had.

Question 3

Does it matter whether the rental is in Midland or Odessa for the DSCR math?

Accepted Answer

Yes, and the tax line moves the ratio more than most investors expect. A City of Midland / Midland ISD parcel stacks to about $1.47 per $100 of value in 2025 taxing rates. An Ector County / City of Odessa parcel, including the county, city, school, and college rates, stacks past $2.09 per $100 before the hospital district is even added. On a $300,000 rental, that gap runs roughly $1,900 or more a year in additional property tax, which comes straight out of the net operating income a DSCR loan measures. Cheaper acquisition price in Odessa does not automatically mean a better ratio once the tax stack is in the model.

Question 4

What do I need to register if I want to run this rental as a short-term rental in Midland?

Accepted Answer

City registration and a 7% hotel occupancy tax, effective since February 1, 2022. The City of Midland requires short-term rental owners to register through its portal, which also uses Host Compliance to identify unregistered listings, and to collect and remit a 7% hotel occupancy tax quarterly. The city defines a short-term rental as a stay by a non-permanent resident, with a business test of 80% of gross receipts coming from stays of 30 consecutive days or less. The city's short-term rental page does not list a zoning restriction, unit cap, or minimum-stay rule, though that is what the page states rather than a full read of the zoning code, so confirm against the current ordinance before you count on it. If you want the DSCR loan sized on short-term income, get the registration and tax setup settled first.

Question 5

Is holding a rental in West Odessa different from holding one inside the Odessa city limits?

Accepted Answer

Yes. West Odessa is unincorporated, so there is no city permit office and no city property tax line on the bill. About 33,340 people live in this unincorporated community west of Odessa, which means county rules apply rather than a municipal code, and there is no city permit office. That generally makes it cheaper to hold and simpler to build on, but services are thinner too. We have not verified how Ector County handles short-term rental registration or hotel occupancy tax outside the Odessa city limits, so confirm that with the county before you underwrite short-term income on a West Odessa property.

Question 6

What is a DSCR loan, and how do I qualify without tax returns?

Accepted Answer

A DSCR (debt service coverage ratio) loan qualifies on the property's rental income instead of your personal income, so there are no W-2s or tax returns required. We compare the rent, from a signed lease or the appraiser's market-rent estimate, against the monthly payment. A DSCR of 1.00 means the rent covers the payment, and we lend with a DSCR as low as 0.75.

Question 7

What rate and terms can I get on a rental loan?

Accepted Answer

Our rental program starts around 5.50% interest-only, with 30-year fixed and 5/7/10-year ARM options, for a single property or a whole portfolio. The lowest pricing goes to strong credit, lower leverage, and a DSCR above 1.20; your quote depends on the file and is subject to underwriting.

Question 8

How much can I borrow, and what is the maximum LTV?

Accepted Answer

We finance up to 80% loan-to-value on a purchase, with rate-and-term and cash-out refinances available, on loan amounts from $100K to $3M. Cash-out leverage is typically a little lower than purchase. The property's cash flow and your credit set your final leverage.

Question 9

What credit score do I need for a DSCR loan?

Accepted Answer

We start at 640, and the best pricing goes to strong credit. Because the loan qualifies on the asset, your score affects your rate and leverage more than whether you are approved.

Question 10

Can I get a DSCR loan on a short-term rental (Airbnb)?

Accepted Answer

Yes, short-term rentals are considered. We can underwrite using market or projected rents, and the property still needs to meet our DSCR. Tell us how the property is operated so we can structure it correctly.

Question 11

Is there a prepayment penalty?

Accepted Answer

Long-term rental loans usually carry a prepayment penalty, commonly a step-down such as 5/4/3/2/1. We offer flexible prepay structures, including buying down to a shorter penalty for a slightly higher rate, and we will lay out the options on your term sheet.

Rental / DSCR in Midland

How it works

Run your Rental / DSCR numbers.

Rental / DSCR in Midland: local questions

Rental / DSCR questions, answered.

Guides for Rental / DSCR

Rental / DSCR vs. other options

Other programs in Midland

Funding Midland deals fast.