Reviewed by David Ghazaryan, Mortgage Broker, NMLS 1486726 · iQRATE Mortgages, NMLS 1862492 · Licensed in Nevada, California, Texas and Florida · Last updated: November 10, 2026.
A DSCR loan lets a Pasadena rental qualify on its rent, not your personal tax returns. We help investors compare DSCR programs for rentals in Los Angeles County. That includes nearby communities such as South Pasadena, Altadena, San Marino, and East Pasadena. It also helps out-of-town owners who keep a San Gabriel Valley house as a rental. This is not a commitment to lend.
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5.0 stars from 89 reviews on Experience.com (November 2026) · Read David's reviews on Experience.com
Part of our California mortgage broker and Pasadena mortgage broker coverage. See also DSCR loans and investor loans.
Pasadena DSCR loan facts at a glance
| Item | What it means on a Pasadena file |
|---|---|
| How you qualify | The property's rent is compared with PITIA (principal, interest, taxes, insurance, and HOA or assessments) |
| 2026 one-unit high-balance limit, Los Angeles County | $1,249,125 conforming and $1,249,125 FHA (FHFA and HUD). This is not a DSCR cap. |
| Property tax | Proposition 13 reassesses to the purchase price. The 1% base plus local levies is often about 1.1–1.3% of the price, labeled from our existing Pasadena mortgage-broker page, not a firm citywide quote. |
| Transfer tax | Los Angeles County documentary transfer tax is $1.10 per $1,000. Measure ULA applies only inside the City of Los Angeles, not Pasadena. |
| Insurance | Wildfire and the California FAIR Plan come up often after the January 2025 Eaton Fire. Get quotes early. Count the full premium in PITIA. |
What a DSCR loan is, and how the ratio works
DSCR means debt-service coverage ratio. Lenders divide the accepted monthly rent by the monthly housing payment. That payment is PITIA: principal and interest, property tax, insurance, and HOA or special assessments, including any Mello-Roos. A result of 1.00 or higher means the rent covers the full payment. A result under 1.00 means it does not. Some programs still allow a ratio below 1.00 when the equity and reserves are strong. Others want a cushion above 1.00. The contract and the lender's overlay control that point.
In my work as a broker, I look at the entire payment, not just the note rate. I've seen files stall because a FAIR Plan premium or a special assessment was left out of PITIA. We fund DSCR purchases and refinances this way in markets where we already close, and we use the same method on a Pasadena rental.
A DSCR loan is not a conventional loan and not an FHA loan. It is a non-QM investor program. Many DSCR lenders want around 20% down on a purchase. Credit score, reserves, and prepay rules still matter. Days to close often land inside of 30 days when the appraisal and insurance are ready. This is still not a commitment to lend.
Why Pasadena investors use a DSCR loan
Pasadena sits in the San Gabriel Valley, with Caltech, JPL, Huntington Hospital, and Kaiser nearby. That employment base supports long-term rentals. Older craftsman and Spanish homes in Bungalow Heaven, Madison Heights, and the Arroyo neighborhoods attract both owner-occupants and investors. Condos near Old Pasadena, the Playhouse District, and the Metro A Line need a building review. We shop more than 100 wholesale lenders on complex files instead of one bank's menu.
Self-employed investors, foreign-national buyers, and owners with several rentals often prefer a DSCR file because it starts with the lease, not a two-year tax return. A bank-statement loan is a different path when you still want to qualify on deposits. See our bank statement loans page if that fits better.
Short-term demand around the Rose Bowl exists, but a standard DSCR program usually wants a traditional lease. Event-day or weekend-rental projections are a stricter overlay. Lenders typically will not count that income without a proven history.
2026 loan limits in Los Angeles County
Los Angeles County is a high-cost market in 2026. The one-unit conforming high-balance limit is $1,249,125, the same figure our existing Pasadena mortgage-broker page cites from FHFA. HUD CHUMS lists the 2026 FHA ceiling for Los Angeles County at $1,249,125 for a one-unit home, $1,599,375 for two units, $1,933,200 for three units, and $2,402,625 for four units. Those FHA figures are official. They are not a DSCR cap. A DSCR lender sets its own maximum loan amount.
The national conforming floor in 2026 is $832,750 for one unit, $1,066,250 for two units, $1,288,800 for three units, and $1,601,750 for four units. In Los Angeles County the high-balance ceiling sits above that floor. A loan above $1,249,125 is a jumbo file on the conforming side. Jumbo is a different program. See our jumbo loans page if the price is above the high-balance limit. FHA is also a different path; see FHA loans.
| Units | 2026 FHA limit, Los Angeles County (HUD CHUMS) |
|---|---|
| One unit | $1,249,125 |
| Two units | $1,599,375 |
| Three units | $1,933,200 |
| Four units | $2,402,625 |
Sources: FHFA, conforming loan limit values for 2026, and HUD CHUMS 2026 FHA forward limits.
FY2026 fair-market rent for the Los Angeles HMFA
HUD's FY2026 fair-market rents for the Los Angeles-Long Beach-Glendale, CA HMFA, which covers Los Angeles County, are $1,863 for an efficiency, $2,085 for one bedroom, $2,601 for two bedrooms, $3,298 for three bedrooms, and $3,672 for four bedrooms. A lender may still use the lease, a 1007 rent schedule, or a market-rent estimate instead of FMR. FMR is a published benchmark, not a promise of what your house will rent for.
| Bedrooms | FY2026 FMR, Los Angeles-Long Beach-Glendale HMFA |
|---|---|
| Efficiency | $1,863 |
| One bedroom | $2,085 |
| Two bedrooms | $2,601 |
| Three bedrooms | $3,298 |
| Four bedrooms | $3,672 |
Source: HUD FY2026 FMR Schedule.
Property tax, Proposition 13, and transfer tax
Proposition 13 reassesses a home to its purchase price when it sells. The tax is 1% plus local voter-approved levies. On our existing Pasadena mortgage broker page we describe the total as usually about 1.1–1.3% of the price. That range is a labeled example from that page, not a firm official citywide rate. Assessed value then rises at most 2% a year. Expect a supplemental tax bill after you buy. A typical DSCR rental does not receive a homeowner's exemption.
Los Angeles County's documentary transfer tax is $1.10 per $1,000 of the price. On a $500,000 purchase that tax is $550.00. On a $750,000 purchase it is $825.00. On a $1,000,000 purchase it is $1,100.00. Ask escrow whether any city transfer tax also applies. Measure ULA is a City of Los Angeles transfer tax. It does not apply in Pasadena.
Some designated historic homes have Mills Act contracts that can lower property taxes. The contract stays with the property. Ask whether one exists before you write an offer. We do not publish a typical Mills Act savings figure here, because the relief is specific to the house and the contract.
Mello-Roos or other special assessments can appear on some parcels. Count any assessment in PITIA. We do not invent a typical Mello-Roos amount.
Insurance, wildfire, and the California FAIR Plan
Insurance is often the tight line on a Pasadena DSCR file. The Eaton Fire of January 2025 destroyed thousands of homes in Altadena and parts of Pasadena. Many carriers pulled back. Buyers of rebuilt homes or vacant lots need permit and final inspection records. We get insurance quotes early so the premium is in the ratio before you lock.
Some files need the California FAIR Plan plus a wrap or difference-in-conditions policy. That premium can dominate the ratio. We do not publish a typical premium here. The cost is specific to the house, the roof, the brush clearance, and the carrier. An older roof can change what an insurer will write. So can knob-and-tube wiring or an original panel. Lenders want the full landlord policy, including any FAIR Plan premium, inside PITIA.
Flood is less common on most Pasadena streets than in a coastal file, but low-lying lots and properties near the Arroyo can still sit in a FEMA zone. Check the map for the exact lot: FEMA Flood Map Service Center.
How lenders count rent on a Pasadena file
Lenders do not all count rent the same way. Some use the current lease if it is arm's length and in date. Some use the appraiser's 1007 market rent. Some average the two or take the lower figure. Vacant homes often go to market rent. An unpermitted ADU is a common Pasadena issue. Lenders usually will not count unpermitted units in value or rent. Pasadena has offered paths to legalize some ADUs. Check the permit status before you close.
Short-term or event-day rent near the Rose Bowl is a stricter overlay. A standard DSCR program wants a twelve-month lease, not a parade-weekend projection. If you already have a documented short-term history, we can ask which lenders will accept it. Do not assume they will.
Condo buildings near Old Pasadena, the Playhouse District, and the Gold Line (Metro A Line) vary. Lenders check owner-occupancy, reserves, litigation, and commercial space. Some buildings are non-warrantable. That can mean a different DSCR overlay or more down. We confirm the building before you spend money on an appraisal.
Cash-out, purchases, and what the payment must clear
A DSCR purchase uses the rent to support the new payment. A rate-and-term refinance does the same on an existing loan. A cash-out refinance adds proceeds. The new PITIA must still clear the lender's minimum ratio. If the cash-out payment pushes the ratio too low, we can shorten the term, add a modest principal reduction, or compare interest-only options where a lender allows them. Interest-only is not always available. When it is, the ratio is tested on the interest-only payment plus taxes, insurance, and HOA during the interest-only period, then again on the fully amortizing payment if the guideline requires it.
Adjustable-rate (ARM) programs appear on some DSCR menus. We test the payment the lender will actually use, which may be the initial payment or a qualifying payment. Points and origination are cash to close, not a monthly PITIA line, unless a lender finances them. Prepay schedules vary. Some loans are open. Some have a three- or five-year step-down. Read the prepay before you lock.
Reserves still matter. Fannie Mae's published reserve framework for multiple financed properties is a conventional-loan rule, not a DSCR rule, but it is a useful official reference for how housing finance thinks about reserves: minimum reserve requirements and multiple financed properties. DSCR overlays are separate. We will tell you what a given lender wants on your file. Seasoning rules can also apply on a recent purchase or a cash-out.
Title in an LLC, and when DSCR is not the right path
Many investors title a Pasadena rental in an LLC. Some DSCR lenders allow the LLC to sit on title and on the note. Some want a personal guaranty. Some want the property seasoned in the entity before a cash-out. Vesting has to match the program before you open escrow. We confirm that early.
CalHFA MyHome and other California down-payment programs are not a DSCR path. They are owner-occupant programs. A conventional or FHA loan with personal income may be a better fit if you will live in the house. A DSCR loan is for investment property. It is not a substitute for a renovation loan when the house is not rentable as-is. If the property needs heavy work, say so up front.
This page is not a consumer credit advertisement under Regulation Z, 12 C.F.R. § 1026.3, and it is not a commitment to lend. Programs, rates, and terms vary by lender and change without notice. See 12 C.F.R. § 1026.3.
Estimate your Pasadena DSCR
Enter the monthly rent and the monthly payment pieces. The calculator divides rent by PITIA. It does not approve a loan. It does not lock a rate. It does not replace a Loan Estimate.
Real DSCR files we closed
The files below are real, and they are from markets where we have already closed DSCR loans, not from Pasadena. We do not invent local closings. They show how we work a DSCR file in any city, including Los Angeles County.
- Two condos, one day. In fall 2024 we closed two condo purchases for a Las Vegas investor with five or more rentals, both on the same day. The appraiser's rent pushed one ratio down to 0.82, and we kept the loans approved because the equity and reserves carried them.
- A foreign-national buyer. In spring 2023 we closed a DSCR loan for a foreign-national investor who bought a $435,000 rental in Las Vegas, using the property's rent rather than U.S. tax returns.
- A small-balance LLC refinance. A Nevada investor's LLC refinanced a $160,000 single-family rental in Kansas City. The appraisal came in $50,000 higher, the DSCR was 1.45, and the file went from submission to clear to close in 13 days.
- An out-of-state Texas refinance. In spring 2025 we closed a DSCR refinance on a Dallas rental held in an LLC, along with other out-of-state investment loans for clients in the same period. The pattern is the same one we use here: qualify on rent, confirm reserves, and match vesting to the program.
"One thing being a real estate investor has taught me is that getting a loan approved and making a good investment are two different things. I've seen investors spend weeks negotiating a purchase price and then barely examine the financing terms. They focus on the interest rate. I look at the entire transaction: cash invested, monthly carrying costs, reserves, prepayment penalties, and the exit strategy."
— David Ghazaryan
What clients say about investment-property loans with us:
"Andrei and David were so great! They're helpful and communicated everything with me through the whole process. I am so pleased and look forward to using iqrate for my future investment properties. 10/10 Will be reccomending to friends."
— Kassandra Arthur, 5-star review on Google
"David helped me to purchase my investment home earlier this month. Very happy I was referred to him by my real estate agent. He started from tax advice on how to file to easily qualify and ended with a congratulatory call when the loan funded. Best mortgage broker in town, hands down. That rhymed. We started the process early December and he advised me to lock the rate as soon as possible since rates were going up. Then about a week later after the loan had been approved, he called me advised me the rates had gone down and I could get 0.25% lower interest rate. He switched to another bank, relocked and started the process again. I wouldn’t have even known rates were down and that I could save, the sole fact he did this makes me very grateful to him. This shows he cares, and others need to know. Now, I’m saving for another 20% down to buy another investment home. I highly recommend David."
— Samvel Harutyunyan, 5-star review on Zillow
"David handled the purchase of my investment duplex in Olympia - Washington State. He came recommended by my realtor, and was very attentive, closed on time, and communicated clearly."
— Nnamdi Chima, 5-star review on Zillow
Areas and property types we see in the Pasadena market
We work files across the city and the nearby communities that share Los Angeles County loan limits. The map below is a working list, not a limit on where we can lend.
- Old Pasadena and the Playhouse District (91101, 91106). Condos and mixed-use buildings close to shops and the Metro A Line. Building review is often the first question.
- Bungalow Heaven and Pasadena north (91104). Craftsman and period homes. Historic or landmark review can affect renovation plans and insurance.
- Madison Heights and the South Pasadena border (91106, 91030). South Pasadena is a separate city with its own schools and rules. It is still in Los Angeles County, so the 2026 high-balance limit is the same $1,249,125.
- The Arroyo and Linda Vista (91103, 91105). Hillside and arroyo lots. Check brush clearance, access, and flood maps on the exact parcel.
- East Pasadena (91107). A mix of mid-century houses and small multifamily. 2–4 unit buildings can use the higher FHA ceilings noted above when the product is FHA, not DSCR.
- San Marino (91108), Altadena (91001), and La Cañada Flintridge (91011). Separate cities or communities, same county limits. Altadena rebuilds after the Eaton Fire need permit and inspection records. Insurance quotes come first.
Older systems show up often. Knob-and-tube wiring, original plumbing, and unreinforced foundations are common inspection findings. They can change what an insurer will write and what a lender will require before closing. We would rather see the inspection early than redesign the ratio at the last week.
Inland Empire comparisons come up with some investors who also hold houses in Riverside or San Bernardino County. Those counties have their own limits and tax bills. A Pasadena file is priced on Los Angeles County figures, not on an Inland Empire average.
Video: why DSCR approvals fail on older rentals
Older roofs, incomplete insurance, and rent that does not match the appraisal are common reasons a DSCR file stalls. The short video below walks through those issues. It is a general briefing, not a Pasadena-specific closing story.
Frequently asked questions
Can I use a DSCR loan on a Pasadena rental without tax returns?
Yes, that is the point of the program. The lender starts with the property's rent and the PITIA payment, not your personal tax returns. You still provide a credit report, reserves, an appraisal, insurance, and entity documents if the property sits in an LLC. Overlays vary by lender.
What down payment do DSCR lenders want in Pasadena?
Many DSCR lenders want around 20% down on a purchase. Some allow less with a stronger ratio, credit score, and reserves. Some want more on a condo, a short-term rental, or a heavy cash-out. We compare overlays instead of quoting one number as a rule.
Does Measure ULA apply to a Pasadena purchase?
No. Measure ULA is a City of Los Angeles transfer tax. Pasadena is a separate city. The county documentary transfer tax of $1.10 per $1,000 still applies. Ask escrow whether any city transfer tax also applies to the exact parcel.
Will a lender count rent from an unpermitted ADU?
Usually no. Lenders typically will not count an unpermitted unit in value or in rent. If you plan to legalize the unit, finish that work and the permits before you rely on that rent. We can talk through timing, but we will not treat unpermitted rent as qualifying income.
How does the California FAIR Plan affect the DSCR ratio?
If the only available coverage is a FAIR Plan policy plus a wrap, the combined premium goes into PITIA. That can lower the ratio. Get quotes before you lock so the payment used in the calculator is the payment the lender will test.
Can I close a Pasadena DSCR loan in an LLC?
Often yes. Many DSCR lenders allow LLC vesting, sometimes with a personal guaranty. Vesting has to match the approval. We confirm the entity documents, season, and title style before you open escrow.
Is a short-term rental near the Rose Bowl eligible?
Only if a lender's overlay accepts it. A standard DSCR program wants a traditional lease. Event-day or weekend income usually needs a documented history, and some lenders will not count it at all. Tell us the actual use of the house.
Are South Pasadena and San Marino under the same 2026 loan limits?
Yes on the county limits. South Pasadena, San Marino, Altadena, and La Cañada Flintridge are not the City of Pasadena, but they are in Los Angeles County. The 2026 one-unit high-balance limit is $1,249,125. Each city still has its own tax and permit rules.
How fast can a DSCR loan close?
Many of our DSCR files close in under 30 days when the appraisal, insurance, and entity documents are ready. Days to close depend on the appraiser's calendar, the insurance quote, and how quickly you return conditions. This is not a 17-day conventional commitment. We will give you a file-specific timeline.
Is this a commitment to lend?
No. This page is general information. Every loan is subject to credit, property, and underwriting approval. Programs and terms change without notice. iQRATE Mortgages, NMLS 1862492, and David Ghazaryan, NMLS 1486726, are licensed in Nevada, California, Texas, and Florida. Equal Housing Opportunity.
Talk with us about a Pasadena rental
If you are buying or refinancing a rental in Pasadena or nearby Los Angeles County, send the address, the lease or rent estimate, and the estimated payment. We will run the ratio, compare DSCR overlays, and tell you what is missing. Apply now, contact us, or call (702) 766-3744.
More: Pasadena mortgage broker · California mortgage broker · DSCR loans · investor loans · our guarantees · closing costs by state
Sources
- FHFA, Conforming Loan Limit Values for 2026
- HUD CHUMS, 2026 FHA forward limits
- HUD, FY2026 Fair Market Rent Schedule
- iQRATE, Pasadena mortgage broker page (labeled property-tax range, county transfer tax, and Measure ULA note)
- FEMA Flood Map Service Center
- Fannie Mae Selling Guide B2-2-03, multiple financed properties
- Fannie Mae Selling Guide B3-4.1-01, minimum reserve requirements
- Fannie Mae Selling Guide B3-3.1-08, rental income
- CFPB, Regulation Z, 12 C.F.R. § 1026.3
- NMLS Consumer Access, iQRATE Mortgages, NMLS 1862492
iQRATE Mortgages · NMLS 1862492 · 6360 S Rainbow Blvd Ste 101, Las Vegas, NV 89118 · (702) 766-3744 · Licensed in Nevada, California, Texas and Florida. David Ghazaryan, Mortgage Broker, NMLS 1486726. Verify us on NMLS Consumer Access. Equal Housing Opportunity. This is not a commitment to lend; programs, rates and terms vary by lender and change without notice, and are subject to credit, property and underwriting approval. Local tax and program facts on this page come from the public sources listed above and are not legal or tax advice.
