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Program 02
Rental / DSCR in Washington DC
DSCR loans for Washington DC rentals, underwritten on the property.
Hold your rentals with financing that underwrites the asset, not just you, with DSCR as low as 0.75, rates from 5.5% interest-only, and 30-year fixed options across Washington DC, Maryland and Northern Virginia. Rent control runs three different ways within one commute: capped in the District, capped in Montgomery County, and uncapped in Arlington, Alexandria and Fairfax. The ownership structure that keeps a business-purpose loan clean in the District can also forfeit a landlord exemption there, so pro forma and entity choice both matter before you close. Business-purpose only, and rates and structure are set in underwriting.
0.75
min DSCR
5.5%
rates from
30-yr
fixed avail.
80%
max LTV
Typical figures, subject to underwriting and market conditions. Not a commitment to lend.
How it works
No tax returns or personal income docs in most cases. We qualify on the property's cash flow, so you can scale your portfolio without the paperwork drag of conventional lending.
Who it's for
Buy-and-hold investors
Single rentals and portfolios
Short-term rentals considered
Rate/term and cash-out refi
Typical terms
Loan amount$100K to $3M
Max leverageUp to 80% LTV
DSCRFrom 0.75
CreditFrom 640
Term30-yr fixed / 5-7-10 ARM
RateFrom 5.50% IO*
PrepayFlexible structures
*Typical terms, subject to underwriting and market conditions.
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Local FAQ
Rental / DSCR in Washington DC, answered.
Why can't I use one rent-growth assumption across a DSCR portfolio that spans DC, Montgomery County and Northern Virginia?
Because the three jurisdictions cap your rent three different ways. For Rent Control Year 2026 (May 1, 2026 through April 30, 2027), the District's cap is 4.1% for general tenants. Montgomery County runs its own rent stabilization law, and for July 1, 2026 through June 30, 2027 its cap is 5.2% of base rent. Arlington County, the City of Alexandria and Fairfax County have no rent cap at all: Virginia is a Dillon Rule state and its localities lack the authority to enact one. A DSCR pro forma that assumes the same rent growth on a District unit, a Montgomery County unit, and an Arlington unit is wrong on at least two of the three. Note also that Montgomery's cap only reaches county-licensed units at least 23 years old and does not cover the incorporated municipalities of Rockville, Gaithersburg or Takoma Park, so a Rockville rental is not subject to the county's cap.
Sources: ota.dc.gov, montgomerycountymd.gov
If my DC tenant moves out, can I reset the unit to Washington DC market rent on my DSCR file?
No, not on a covered District unit. Under DC Code 42-3502.13, a vacancy in a rent-controlled District unit allows only a 10% increase if the outgoing tenant occupied it 10 years or less, or 20% if longer, and no increase at all unless the unit is registered. That vacancy bump, not the market rent a listing site shows you, is the real value-add ceiling on a covered District rental. The rule is District-specific: it has no equivalent in Montgomery County or in Arlington, Alexandria or Fairfax. Build your DSCR pro forma off the vacancy-increase math on any District property, and confirm registration status before you underwrite a turn.
Does buying my Washington DC rental through an LLC protect the loan and the property the same way?
It protects the loan, but it can cost the property its rent-control exemption. The District's small-landlord exemption requires 4 or fewer units owned by 4 or fewer natural persons who hold no other District rental interest and have filed an exemption claim with the Rent Administrator; it is unavailable to an LLC, a corporation, a REIT, or any owner above that threshold. The entity structure that keeps a business-purpose loan clean under DC Code 26-1101 is the same structure that forfeits the small-landlord exemption. This is a District-only rule: it has no counterpart for a Maryland or Virginia rental in this file. Talk to your attorney before assuming a District unit qualifies for the exemption.
Sources: dhcd.dc.gov
Why does one county show two different property tax rates on my DSCR pro forma?
Because Maryland taxes the parcel, not the county line. Unincorporated Prince George's County runs a base rate of 1.1120 per $100 of assessed value. Hyattsville, an incorporated city inside Prince George's County, adds its own municipal levy on top and comes out to 1.6220 per $100, the highest all-in rate in this metro, even though Hyattsville also carries the lowest home values here. A DSCR pro forma built on a "Prince George's County rate" for a Hyattsville parcel understates the tax line by roughly half a point of assessed value. Pull the parcel's actual municipal jurisdiction, whether that is Hyattsville, unincorporated Prince George's County, or a Montgomery County city, before you underwrite the tax line.
Sources: dat.maryland.gov
Does my Washington DC rental portfolio carry a different legal risk than the same portfolio in Arlington or Alexandria?
Yes, on two separate fronts. A tenanted District building can carry a Tenant Opportunity to Purchase Act (TOPA) obligation before you can sell it, on top of the District's rent-control cap on what you can raise. Neither rule reaches Arlington County, the City of Alexandria, or Fairfax County: Virginia has no rent control and no TOPA analogue in this file. Scale works against you in the District specifically. Both the small-landlord rent control exemption and the RENTAL Act's 2 to 4 unit TOPA exemption fail once an owner holds multiple District properties, so a fifth District door can change the legal treatment of the first four. Cross-collateralizing a District property and a Virginia property in one DSCR portfolio loan means underwriting two rulebooks, not one.
Sources: hklaw.com
Can I run my Washington DC metro DSCR property as a short-term rental instead of a long-term lease?
Only in a homeowner's capacity, and only outside the District. Washington DC's short-term rental licensing agency states plainly that the property must be the owner's primary residence, proven by Homestead Tax Deduction eligibility, and that a business entity such as an LLC or corporation cannot be a host; there is no lawful investor short-term rental in the District. Montgomery County requires the same primary-residence test for its own license, capped at 120 nights a year when the owner is absent. Arlington County's accessory homestay ordinance likewise requires the operator to use the unit as a primary residence at least 185 days a year. Underwrite a DSCR file anywhere in this metro as a long-term lease.
Sources: dlcp.dc.gov, montgomerycountymd.gov, arlingtonva.us
How much do I need to put down on a Washington DC rental with a DSCR loan?
About 20% of the purchase, plus closing costs. Max leverage is up to 80% LTV. On a $500,000 metro purchase that is up to $400,000 from us and $100,000 from you (500,000 x 80% = 400,000). Where the parcel sits changes the rest of the file more than the down payment does: a Hyattsville rental carries the highest all-in rate sourced in our research at 1.6220 per $100 of assessed value, and that lands in your escrow and in the DSCR itself. Subject to underwriting.
Sources: dat.maryland.gov
What credit score do I need for a DSCR loan in Washington DC, and what if the rent does not cover the payment?
Credit starts at 640, and the DSCR can go as low as 0.75. A Washington DC metro property does not have to fully cover its own payment for the file to work, though a thinner ratio is usually handled with lower leverage. We qualify on the property's rent, not your tax returns. On a covered District unit, build that rent line off the vacancy-increase math rather than a listing site's market rent, because a vacancy allows only a 10% increase after a tenancy of 10 years or less, or 20% after longer. Subject to underwriting.
What is the smallest DSCR loan you will write in the Washington DC metro?
$100K is the floor, and $3M is the ceiling. That band covers the range here, from Hyattsville, which carries the lowest home values in this metro, up through the District and the Northern Virginia submarkets. Term options run 30-year fixed or a 5, 7 or 10 year ARM. If your deal falls outside the band, talk to us and we will point you at the right structure. Subject to underwriting.
Sources: dat.maryland.gov
Is there a prepayment penalty if I sell a Washington DC rental early?
Prepay is a flexible structure, set at underwriting rather than fixed by the program. Tell us up front whether you are holding long term or expecting to sell inside a few years, and we will structure the prepay around that plan. It matters here because a District exit is not always on your own timetable: a tenanted District building can carry a Tenant Opportunity to Purchase Act obligation before you can sell, and that has no counterpart in Arlington, Alexandria or Fairfax. Subject to underwriting.
Sources: hklaw.com
More Rental / DSCR questions, answered on the program page
Resources
Guides for Rental / DSCR
Rental / DSCR · 5 min read
What Is a DSCR Loan? How Investors Qualify on Rental Income
Read the guide Strategy · 6 min read
Financing the BRRRR Method: Buy, Rehab, Rent, Refinance, Repeat
Read the guide Rental / DSCR · 5 min read
DSCR vs Conventional Loan: Which Is Better for Investment Property?
Read the guide Rates & Costs · 5 min read
Hard Money Loan Rates and Costs, Explained
Read the guide More in Washington DC
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About the local figures on this page
Local rules move. Every tax rate, fee, ordinance and market figure here comes from a primary source and carries the date we read it, and we correct them as the rules change. Where a number is mid-change or we could not verify it, we say so rather than guess. Before you commit a budget, confirm anything that drives it with the city or county, and talk to your attorney or CPA on questions of law or tax.
Published by USA Mortgage Funding, LLC, NMLS #152588. Researched from primary sources by our team, drafted with AI assistance, and every figure checked against its source before publishing. Where an answer rests on a public record, that record is linked under it. Figures read on 2026-08-15.
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