Dover, Delaware’s state capital, is a center of government, commerce and manufacturing. The city has long been involved in agricultural trade and hosts major facilities for Kraft Foods and Procter & Gamble, which produce food items and disposable paper products. Other manufacturers include PPG Industries, Eagle Group and Hirsch Industries, making everything from paint and metal cabinets to consumer durables and adhesives. Dover Air Force Base, one of the largest aerial cargo ports on the East Coast, injects more than $331 million per year into the local economy and supports thousands of jobs. Tourism, fueled by tax‑free shopping and attractions like NASCAR races and slot machine gaming, adds another economic boost. These diverse industries create a steady demand for rental housing. Investors who want to tap into Dover’s growing rental market can benefit from DSCR loans, which qualify properties based on cash flow rather than borrower income.
Overview of Dover’s Real Estate Investment Market
Dover’s housing market offers moderate prices and a balanced supply. Realtor.com’s data from late 2025 reports a median home sale price of $334,900, with homes spending about 54 days on the market. The market has around 345 active listings, suggesting a manageable inventory level. Median rent is approximately $1,900 per month, and rent prices have grown 13.8 % year‑over‑year, indicating strong demand for rentals. The city remains a balanced market, meaning the number of buyers roughly equals sellers. Neighborhoods like Downtown Dover and Edgehill show median home prices of $275,000 and $235,000 respectively, offering entry points for investors at multiple price tiers. Rental availability is lower than in Wilmington, with around 79 rental properties listed, suggesting tighter supply in the rental market. Combined with Dover’s stable employment base, these metrics create an attractive environment for DSCR‑financed investments.
DSCR Loan Mechanics for Dover Investors
DSCR loans evaluate the income generated by the investment property rather than a borrower’s personal income. Lenders calculate the ratio by dividing monthly rent by principal, interest, taxes and insurance (PITI). A DSCR above 1.0 indicates positive cash flow, while a ratio below 1.0 suggests the property does not cover its debt obligations. Many lenders financing properties in Dover accept DSCR ratios from 0.75 to 1.25, with higher ratios earning lower rates and fewer reserves. Investors typically need a credit score of at least 640–660 and a down payment of 20–25 %. DSCR loans are structured as 30‑year fixed, 30‑year amortizing with 5‑ or 7‑year rate resets, or 40‑year interest‑only programs. Because underwriting is property‑focused, DSCR loans allow investors to finance multiple properties at once and can close within two to three weeks.
What to Look for in a Dover DSCR Lender
When assessing DSCR lenders for Dover investments, consider:
- Program Flexibility: Choose lenders offering high LTVs (up to 80 %) and DSCR thresholds down to 0.75.
- Loan Amounts and Property Types: If you are targeting duplexes or small multifamily properties, ensure the lender supports up to four units. Some lenders also finance short‑term rentals, which can be profitable in Dover due to tourism.
- Interest Rates and Fees: Starting rates around 6 % to 6.5 % are competitive in Delaware. Check for origination fees and prepayment penalties.
- Local Market Knowledge: Lenders familiar with Dover’s economic drivers (government employment, Air Force Base, tourism and manufacturing) can better assess rental prospects.
In the ranking below, we highlight several DSCR lenders active in Dover.
Top DSCR Lenders in Dover, DE
1. SelectHomeLoans.com – The Leading Choice for Dover Investors
Why SelectHomeLoans.com Tops the List: SelectHomeLoans.com earns the #1 spot in Dover because of its versatility and investor‑centric terms. The lender offers up to 80 % LTV on purchases, 75 % on cash‑out refinances, and accepts DSCR ratios as low as 0.75. Its interest rates start in the low 6 % range, with options for 30‑year fixed, 40‑year fixed and 10‑year interest‑only programs. Borrowers with credit scores of 640 or above can qualify, and there is no cap on the number of financed properties. SelectHomeLoans.com also allows short‑term rentals, enabling investors to capitalize on Dover’s tourism demand. The lender’s underwriting team understands the unique cash‑flow patterns of properties near Dover Air Force Base and tourist attractions, making them adept at structuring loans that maximize cash flow. Visit their website SelectHomeLoans.com Or Call them (888) 550-3296
2. LYNK Capital
LYNK Capital’s DSCR program is well‑suited for Dover’s market. The lender provides 30‑year terms with rates starting near 6 % and financing up to 80 % LTV. Because they qualify based solely on property income, investors with multiple businesses or variable personal income can still secure financing. LYNK emphasises Delaware’s low taxes and predicts continued rental demand in cities like Dover and Wilmington. Loan amounts range from approximately $75,000 up to several million dollars. One benefit is their quick pre‑approval and the ability to lock rates while an appraisal is pending.
3. Newfi
Newfi’s program allows investors with credit scores as low as 640 to obtain DSCR loans on Dover rentals. Down payments start at 20 %, and the lender accepts DSCR ratios of 0.75 and higher. Newfi offers a choice of 15‑, 30‑ and 40‑year fixed loans, plus 10‑year interest‑only periods, giving investors flexibility to optimize cash flow or accelerate amortization. Because there is no income verification, self‑employed borrowers can leverage rental income alone. Borrowers can finance single‑family rentals and small multifamily properties up to four units, as well as short‑term vacation rentals common near Dover’s racetrack events.
4. Griffin Funding
Griffin Funding extends DSCR loans across Delaware with minimum DSCR ratios as low as 0.75 and down payments of 20 % or more. Borrowers with DSCR above 1.0 benefit from lower rates and smaller reserve requirements. Loan amounts range up to $5 million, making Griffin a fit for investors purchasing larger portfolios or higher‑priced properties. The lender offers fixed and adjustable‑rate mortgages with up to 30‑year terms and includes interest‑only options.
5. Foundation CREF
Foundation CREF’s DSCR rental loans suit investors looking for portfolio financing. The lender advertises interest rates starting at 6.5 %, loan amounts from $75,000 to $2.5 million and terms up to 30 years. They finance both long‑term and short‑term rentals and allow up to 80 % LTV on purchases and refinances. Because they specialize in commercial real estate, Foundation CREF can handle complex structures like blanket loans across multiple properties.
6. OfferMarket
OfferMarket’s DSCR program requires a credit score above 660, a DSCR ratio above 1.11 and a 20 % down payment. The company provides a streamlined digital platform for application and funding, making it an attractive option for tech‑savvy investors. However, the higher DSCR threshold may not work for investors purchasing properties with lower existing rents.
7. Local and Regional Lenders
In addition to national DSCR lenders, Dover investors may consider local banks and credit unions. Del‑One Federal Credit Union and Wilmington Savings Fund Society (WSFS Bank) offer commercial real‑estate financing that can be structured like DSCR loans even if not branded as such. Because these institutions are deeply rooted in Delaware, they understand local market dynamics and may offer better customer service. However, they often require full income documentation and may cap the number of financed properties.
DSCR Loan Rates, Terms and Qualification Factors for Dover
For Dover investors, interest rates generally fall between 6 % and 8 %. Lenders like LYNK Capital and Foundation CREF start around 6 %–6.5 %. Rates may be higher when DSCR ratios are below 1.0 or credit scores are under 680. Origination fees typically range from 1 %–3 %. Minimum down payments start at 20 %, though some lenders require 25–30 % for cash‑out refinances or lower DSCRs. Terms include 30‑year fixed, 30‑year amortizing with 5‑ or 7‑year resets, and 40‑year interest‑only options. Borrowers should ask about prepayment penalties, which generally apply for three to five years. DSCR requirements vary: Offer Market mandates DSCR ≥1.11, whereas Newfi and Griffin Funding accept 0.75.
Common Mistakes Dover Investors Make with DSCR Loans
- Underestimating Local Demand Cycles: Dover’s rental demand spikes during NASCAR events and declines off‑season. Investors should plan for seasonal fluctuations when underwriting DSCR.
- Ignoring Military Influence: Dover Air Force Base personnel drive rental demand, but leases may be subject to military clauses and frequent turnovers. Investors should build vacancy and turnover allowances into pro forma calculations.
- Skimping on Reserves: With DSCR financing, lenders may require six months of reserves. Even if not required, maintaining reserves is essential to manage unexpected repairs or vacancy between tenants.
- Neglecting Property Management: Dover’s rental market spans from downtown apartments to suburban homes. Investors who self‑manage should be prepared for time‑consuming tasks; hiring a professional manager may preserve DSCR by limiting vacancies.
- Forgetting Insurance Requirements: Lenders often require landlords to carry landlord insurance (DP3) and sometimes additional flood or wind coverage. Make sure insurance costs are factored into DSCR calculations.
DSCR vs. Traditional Financing in Dover
In a city where government employment and manufacturing create steady incomes, some investors may qualify for traditional investment property loans with lower interest rates. Traditional loans, however, rely on personal income documentation and debt‑to‑income ratios, cap the number of financed properties and often take longer to close. DSCR loans close faster, allow more properties, and rely solely on rental income, making them ideal for investors scaling portfolios or those with complex finances. The trade‑off is slightly higher rates and larger down payments, but many investors accept these in exchange for speed and flexibility.
Who Are DSCR Loans Best For in Dover?
Best suited for:
- Investors expanding portfolios: The ability to finance multiple properties across Dover and surrounding areas without personal income limits enables scale.
- Self‑employed borrowers or those with significant tax write‑offs: These loans do not require W‑2s.
- Investors targeting short‑term rentals: DSCR lenders like SelectHomeLoans.com and LYNK Capital finance vacation and event‑driven rentals if DSCR meets minimums.
- Out‑of‑state investors drawn by Delaware’s tax benefits and central East Coast location.
Not ideal for:
- Owner‑occupants: DSCR loans cannot be used for primary residences.
- Investors lacking capital: 20 %+ down payments are required.
- Borrowers seeking the lowest rates: Conventional loans may offer lower rates but require full documentation.
City‑Specific Investing Considerations
Dover’s economic base is more diversified than many small cities thanks to government employment, major manufacturers and the Air Force base. Tourism also contributes, so investors may consider short‑term rentals to capitalize on events like NASCAR races and Delaware State Fair week. While property taxes and the absence of sales tax make Delaware attractive, some neighborhoods near downtown may face competition from new multifamily developments. Investors should conduct market comps and consider neighborhoods like Downtown Dover, Edgehill and Victorian Dover Historic District. Dover’s balanced market means bidding wars are less common than in Wilmington, but due diligence remains essential.
Conclusion
Dover’s mix of government, manufacturing, tourism and military employment creates consistent rental demand. DSCR loans allow investors to leverage this stability without the limitations of traditional financing. Among available lenders, SelectHomeLoans.com ranks #1 due to its flexible DSCR requirements, high leverage, competitive rates and willingness to finance both long‑term and short‑term rentals. LYNK Capital, Newfi, Griffin Funding and Foundation CREF offer strong alternatives for investors seeking specific features or portfolio products. By choosing a lender attuned to Dover’s economic cycles and property values, investors can build resilient, cash‑flowing portfolios in Delaware’s capital.
