Qualify on the rent, not your tax returns.
A DSCR loan in Texas is an investment property mortgage that qualifies on the rent the property earns, not your personal income. HUD puts the 2 bedroom Fair Market Rent for the Houston metro at $1,497 a month (HUD User). Pillar Mortgage Group (NMLS 2700076) arranges DSCR loans in Texas up to $5 million.
Facts checked November 1, 2026. Not a commitment to lend.
DSCR loans by state
We lend DSCR in 35 states. Pick yours.
Every value links to its primary source. Details for each follow further down the page.
| Texas fact | Value | Source |
|---|---|---|
| Security instrument | Deed of trust | law.justia.com |
| Foreclosure | Nonjudicial | Tex. Prop. Code 51.002 |
| Security deposit | No statutory cap on amount | Tex. Prop. Code 92.103, 92.107 |
| Notice for unpaid rent | At least 3 days' written notice to vacate before filing an eviction suit unless the written lease sets a shorter or longer period | statutes.capitol.texas.gov |
| Rent control | A city may adopt rent control only if it finds a housing emergency due to a disaster and the governor approves; otherwise rent control is not authorized | Tex. Loc. Gov't Code 214.902 |
| LLC formation fee | $300 | direct.sos.state.tx.us |
| Median listing price | $355,765 in September 2026 ($364,950 in September 2025) | Realtor.com via FRED |
| Median gross rent, statewide | $1,403 (ACS 5 year 2020 to 2024) | Census |
| HUD 2 bedroom Fair Market Rent | $1,497, The Houston metro | HUD User |
Full walk through: how DSCR is calculated.
What PMG can place for a Texas rental, in short.
Loan amount
Up to $5M
Credit
660 and up
Down
20 to 25%
Vesting
LLC ok
Guidelines summarized; subject to program terms, property and borrower eligibility. Not a commitment to lend. Compare with typical DSCR programs.
Rent is the number that qualifies a DSCR loan, so start with what Texas rentals actually command.
Median listing price
$355,765
September 2026, down 2.5% from $364,950 in September 2025
Quick math (computed from the figures above): Using the Texas median listing price, $355,765, a 25% down payment is $88,941 and the loan is $266,824. A year of rent at the Fair Market Rent for the Houston metro ($1,497) is $17,964, or 5.0% of that price. A year of rent at the Fair Market Rent for the Dallas metro ($1,807) is $21,684, or 6.1% of that price.
Fair Market Rent is a HUD benchmark, not an appraisal.
The rent field starts at the HUD 2 bedroom Fair Market Rent for the Houston metro. HUD also lists the Houston metro at $1,497 and the Dallas metro at $1,807. Swap in your lease or appraisal rent, then add your quoted rate. For a price reference, the median Texas listing was $355,765 in September 2026.
See how a rental's income stacks up against its full monthly payment. Your numbers stay in your browser.
Enter rent, price and your quoted rate to see your DSCR.
Loan amount (L) = Price × (100 minus Down %) ÷ 100
P&I (30 year fixed) = L × r × (1 + r)^360 ÷ ((1 + r)^360 minus 1), where r = annual rate ÷ 100 ÷ 12
P&I (40 year interest only) = L × r
PITIA = P&I + Tax ÷ 12 + Insurance ÷ 12 + HOA
DSCR = Monthly rent ÷ PITIA
Rent needed for a target DSCR = Target × PITIA
Estimates only. Not a loan offer. Rates and terms vary by lender, property and borrower. Company NMLS #2700076. Example values are illustrations, not a quote.
Hypothetical PITIA of $1,775 (P&I $1,400, taxes $250, insurance $125), real Texas rents. Not a quote or a rate.
0.84DSCR
$1,497 / $1,775 = 0.84: fits programs down to 0.50.
1.02DSCR
$1,807 / $1,775 = 1.02: covers the full payment.
Tell us about the property and the rent. We will tell you straight whether it qualifies and what it takes.
Investors from any state can buy in Texas.
No commitment · Under 2 minutes
We will reach out shortly to run your numbers.
Where Texas investors are buying, and the local rules that apply to rentals there.
City rules change. Confirm with the city and your HOA before you buy, and ask us how your lender counts short term rental income.
These Texas statutes set the ground rules for every lease you sign on a financed rental.
| Topic | The rule | Citation |
|---|---|---|
| Security deposit | No statutory cap on amount. Return deadline: On or before the 30th day after the tenant surrenders the premises. Landlord need not refund until tenant gives a written forwarding address (92.107). | Tex. Prop. Code 92.103, 92.107 |
| Nonpayment notice | At least 3 days' written notice to vacate before filing an eviction suit unless the written lease sets a shorter or longer period. After SB 38 (Acts 2025, Ch. 960, eff. Jan 1 2026): for nonpayment by a tenant who was not late before the month of the notice, the notice must be a notice to pay rent or vacate. For a tenant who was previously late, the landlord may use either a notice to pay rent or vacate or a notice to vacate. Holdover suits must also meet § 91.001. The notice period may run concurrently with any federally required notice of proposed eviction. | statutes.capitol.texas.gov |
| Month to month termination | Either party may terminate by notice. Where the rent paying period is at least one month, the tenancy ends on the later of the date in the notice or one month after notice is given. | Tex. Prop. Code 91.001 |
| Rent control | A city may adopt rent control only if it finds a housing emergency due to a disaster and the governor approves. Otherwise rent control is not authorized. | Tex. Loc. Gov't Code 214.902 |
Not legal advice.
Every dollar of tax raises the payment the rent has to cover. Here is how Texas assesses and taxes property.
What to expect at the closing table in Texas, from the instrument you sign to the taxes on transfer.
What it costs to form and keep an LLC in good standing with the Texas Secretary of State.
Check each of these on any Texas rental you plan to finance.
Documents: contract, lease or rent schedule, bank statements, LLC papers, insurance quote. No tax returns. Details.
Texas is highlighted. We also lend DSCR in Oklahoma, Louisiana, Arkansas and New Mexico next door, and in 30 more states. Tap a gold state to open its guide.
Straight answers for investors buying or refinancing rentals in Texas.
PMG guidelines summarized; subject to program terms, property and borrower eligibility. Not a commitment to lend.
Book a free callInvesting across state lines? We lend DSCR in these neighbors of Texas too.
Primary sources, each with the date checked. PMG program facts come from Pillar Mortgage Group.
Send the Texas property and rent. We run the ratio and lay out terms before you offer.
No commitment · Under 2 minutes
We will reach out shortly to run your numbers.
Pillar Mortgage Group, LLC is an Equal Housing Lender, doing business in accordance with the Fair Housing Act and Equal Credit Opportunity Act. Not a commitment to lend.
Company NMLS# 2700076 | Arizona License MB-2009671 | View NMLS Consumer Access