DSCR loans by state

DSCR Loans in South Carolina

Charleston is one of the most desirable small cities in the U.S. with booming tourism, a growing tech sector, and Boeing's 787 Dreamliner production. Greenville has undergone remarkable economic revitalization and consistently ranks among the best places to live. Columbia is affordable with University of South Carolina and state government employment. Myrtle Beach offers STR potential.

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What is a DSCR loan?

A Debt Service Coverage Ratio (DSCR) loan is a type of investment property mortgage where the borrower qualifies based on the property's rental income rather than personal income. Lenders calculate the DSCR by dividing the property's gross rental income by the total debt obligation (principal, interest, taxes, insurance, and HOA). A ratio of 1.0 means the property breaks even; most lenders require a DSCR of 1.0–1.25 to approve the loan.

Because DSCR loans do not require W-2s, tax returns, or employment verification, they are popular among self-employed investors, LLC-based portfolios, and foreign nationals. Typical terms include 30-year fixed or adjustable rates, 75–80% LTV, and minimum credit scores of 660–700. State-level factors like property taxes, insurance requirements, and landlord-tenant laws directly affect the DSCR calculation and vary significantly across markets.

South Carolina Property Taxes & DSCR Impact

South Carolina's effective property tax rate averages approximately 0.56% — among the lowest in the nation. However, non-owner-occupied properties are assessed at 6% of market value vs. 4% for primary residences, so the effective rate for investment properties is higher. Still, overall tax burden remains low.

Low effective property taxes, even for investment properties, create a favorable expense profile. Greenville and Columbia offer the best DSCR cash-flow metrics with prices under $300,000 and strong rents. Charleston prices have risen significantly, so investors should target North Charleston or surrounding areas for better DSCR outcomes.

South Carolina Landlord-Tenant Laws

South Carolina is very landlord-friendly. No rent control exists. Eviction for nonpayment requires a 5-day notice, and the court process typically completes in 2–3 weeks. South Carolina's Landlord-Tenant Act provides clear guidelines favoring property owners.

South Carolina Income Tax for Investors

South Carolina has a graduated income tax with a top rate of 6.4% on income over $16,040 (a very low threshold). Recent reform efforts aim to reduce this rate. Rental income is fully taxable.

Insurance Costs in South Carolina

Coastal South Carolina (Charleston, Myrtle Beach, Hilton Head) requires hurricane and flood insurance ($2,000–$5,000+). Inland areas (Greenville, Columbia) have moderate premiums of $1,100–$1,800. The SC Wind and Hail Underwriting Association provides coastal coverage.

Top Investor Markets in South Carolina

•Charleston
•Greenville
•Columbia
•Myrtle Beach
•Spartanburg

Licensing Requirements

South Carolina requires mortgage lenders and brokers to be licensed through the SC Department of Consumer Affairs.

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