The Best DSCR Lenders in Iowa (Rental Property Loans) [2025 Guide]

Iowa’s economy is more than cornfields and wind turbines. Over the past decade the state has cultivated biotech, insurance and manufacturing industries while maintaining affordable housing and a high quality of life. Cities such as Des Moines, Cedar Rapids and Iowa City attract young professionals, and small college towns create consistent rental demand. For real‑estate investors seeking to build or expand their rental portfolio in Iowa, debt‑service‑coverage‑ratio (DSCR) loans can unlock financing that isn’t tied to personal income. This 2025 guide explains how DSCR loans work in Iowa, highlights eligibility requirements and introduces the best lenders—placing Select Home Loans at the top for its customer‑centric approach. You’ll also learn how DSCR loans can help you purchase, refinance or cash out equity on rental properties throughout the state.

Understanding DSCR Loans

As discussed earlier, DSCR loans base qualification on the property’s ability to service the debt rather than on the borrower’s W‑2 income. New Silver notes that these loans are investment property loans based on the cash flow of the property, and applications typically do not require personal financial information. Investors supply information about the property’s rent potential, expenses and purchase price; the lender calculates the debt service coverage ratio by dividing net operating income by debt service. A DSCR above 1 indicates that the property generates enough income to cover mortgage payments. Many lenders prefer DSCRs of 1.25 or higher, though some programs allow ratios down to 0.75.

Because DSCR lenders are private or non‑QM lenders, they can be more flexible about credit scores, down payments and property types compared with conventional mortgages. Loan terms often include 30‑year fixed rates, interest‑only periods or adjustable‑rate mortgages. DSCR loans are ideal for both novice and seasoned investors who want to scale their portfolios quickly, preserve personal liquidity or finance properties held by LLCs.

Iowa’s Market Appeal

Iowa home prices remain lower than the national median while incomes have risen, creating attractive cash‑flow opportunities. The state benefits from stable government and insurance sectors, a growing tech presence and a strong agricultural base. Many investors target rental properties near universities (University of Iowa, Iowa State University) or in downtown Des Moines where young professionals need housing. Because DSCR lenders evaluate the property rather than the borrower, they are well suited to self‑employed investors, small business owners or those juggling multiple projects who may not qualify for conventional financing. Lenders like Griffin Funding and Newfi actively market DSCR programs in Iowa and understand local market nuances.

DSCR Loan Requirements in Iowa

While specific guidelines vary by lender, the Iowa DSCR loans page from Griffin Funding provides a good overview of typical requirements:

• DSCR threshold – Most lenders want to see a DSCR between 1.25 and 0.75, with ratios above 1.25 considered ideal. Griffin Funding will accept DSCRs as low as 0.75.
  
• Credit score – Lenders typically require FICO scores between 620 and 680. Higher credit scores can lead to better interest rates.
  
• Down payment – Expect to put down 20–25 % of the purchase price. Griffin Funding notes that exact amounts vary with DSCR, credit score and reserves; lower DSCRs often require higher down payments.
  
• Loan amount – Loan amounts typically range from $100,000 to $5 million, giving investors flexibility to finance single‑family rentals and small multifamily properties.
  
• Proof of cash flow – Borrowers must demonstrate that the property generates (or will generate) a stable cash flow. This can involve leases, rent schedules, or market rent analysis.
  
• Appraisal and credit review – DSCR lenders order an appraisal to confirm the property’s value and may perform a credit check, although credit scores play a secondary role to the DSCR.
  

Understanding these standards will help you prepare and assess whether your property qualifies before applying.

Top DSCR Lenders in Iowa (Select Home Loans Ranked #1)

1. Select Home Loans – Leading the Iowa Market

Website: SelectHomeLoans.com

Phone: 888-550-3296

Select Home Loans earns the top ranking for Iowa investors because of its flexibility and commitment to customer service. Investors appreciate that Select Home Loans offers DSCR mortgages up to $5 million, provides rate‑buydown options and allows borrowers to close loans through LLCs. The lender focuses on quick pre‑approvals and transparent underwriting, making it easier to compete with cash buyers. Its loan officers are experienced with Midwestern markets and can advise on property types from single‑family rentals to small multifamily buildings. Select Home Loans typically requires a DSCR of 1.0 or higher, offers interest‑only periods and may finance short‑term rental properties. These features, coupled with competitive rates, make it the preferred choice for many Iowa investors.

2. Griffin Funding

Griffin Funding operates nationwide and maintains a robust DSCR program in Iowa. The company emphasizes that DSCR loans are cash‑flow‑focused and make it easier for investors, entrepreneurs and self‑employed borrowers to qualify. Key advantages include flexibility in creditworthiness metrics, which allows borrowers with modest credit scores to secure financing. Griffin Funding offers loan amounts up to $5 million and accepts DSCR ratios as low as 0.75. Borrowers can use DSCR loans to purchase or refinance 1‑4 unit residential properties, and there is no limit to the number of properties you can finance. Griffin Funding highlights faster closing times because DSCR loans do not require personal income verification. The lender also underscores that down payments typically range from 20–25 % and credit score requirements start at 620.

3. Newfi Lending

Although based in California, Newfi has an investment‑property mortgage platform that lends in Iowa. While its Indiana guide discusses eligibility (minimum credit score 640, DSCR 1.0 or higher, down payment as low as 20 %), these guidelines also apply to other states where Newfi operates. Newfi offers 30‑ and 40‑year fixed loans as well as interest‑only terms. For investors seeking long amortization periods to maximise cash flow, Newfi may be appealing. The lender allows DSCRs as low as 0.8, giving more flexibility for properties with tight cash flow. Newfi provides a simple online application and a DSCR calculator to estimate eligibility, making it easy for investors to explore options.

4. Kiavi and New Silver

Kiavi and New Silver are national DSCR lenders recognized for competitive rates and streamlined processes. Kiavi’s rental loans require no tax or income documentation and feature LTVs up to 80 %, rates starting at 7.25 % and no pre‑payment penalty after three years. New Silver, meanwhile, is highlighted for offering DSCR loans without a minimum DSCR requirement, making it an option for deals with minimal positive cash flow. Both lenders finance 30‑year fixed mortgages and can be useful for Iowa investors who don’t meet local lenders’ requirements.

5. Lima One Capital and Angel Oak

Lima One Capital and Angel Oak round out the list for Iowa. Lima One requires a DSCR of 1.5 or higher and a minimum FICO of 700, making it a fit for investors with strong cash flow who want institutional‑grade financing. Angel Oak provides investor cash‑flow loans up to $1.5 million, with 40‑year fixed terms and interest‑only options. There is no limit on the number of properties investors can finance. While not Iowa‑specific, these lenders serve the state and can be good alternatives.

Choosing an Iowa DSCR Lender

When comparing DSCR lenders for an Iowa investment, consider the following:

1. Loan term and rates. Determine whether you want a 30‑year fixed mortgage, an ARM with lower initial payments or an interest‑only period. Compare rates across lenders and ask about pre‑payment penalties.
   
2. DSCR threshold. Make sure your property’s DSCR meets the lender’s minimum. Griffin Funding’s minimum is 0.75 while Lima One requires 1.5. Higher DSCRs typically result in better pricing.
   
3. Credit and down payment. Verify your credit score and liquidity to ensure you can meet the lender’s down payment and reserve requirements.
   
4. Closing speed. Ask lenders about typical closing timelines. Griffin Funding aims to close DSCR loans in 30 days or less, while some national lenders may take longer.
   
5. Local expertise. A lender who understands Iowa’s rental markets can provide better advice on rents, property management and exit strategies.
   

Application Process in Iowa

The application process is similar to that described for Indiana. After an initial consultation, the lender will perform a rent analysis and calculate the DSCR. You’ll submit the purchase contract, rent schedule and a credit authorization. Griffin Funding emphasises that DSCR loans do not require personal income verification, which streamlines underwriting. Once the appraisal and underwriting are complete, closing is scheduled—often within a month. After closing you’ll make monthly mortgage payments from rental income. Because DSCR lenders typically report to credit bureaus, timely payments help build your business credit.

Conclusion

Iowa offers a fertile landscape for rental property investors thanks to affordable housing, steady population growth and diversified industries. DSCR loans allow investors to finance those properties based on cash flow rather than W‑2 income, helping self‑employed and entrepreneurial borrowers qualify. Select Home Loans tops the list for Iowa due to its competitive rates, fast pre‑approvals and personalized service. Other lenders such as Griffin Funding, Newfi, Kiavi, New Silver, Lima One and Angel Oak each have strengths depending on the property type and DSCR ratio. When evaluating options, pay attention to DSCR thresholds, credit requirements, closing speed and whether the lender is a direct lender or a broker. With the right financing partner, you can build a scalable Iowa rental portfolio and take advantage of the state’s long‑term growth.