Colorado DSCR Loans & Rates 2026

Colorado DSCR loan terms at a glance

Term	Save Financial (20+ DSCR lenders)
Minimum DSCR	1.0+ for the best pricing; down to 0.75 on a separate program at a higher rate; no-ratio option where rent is not used
Max loan-to-value	Up to 80% on purchases (20% down); about 75% on the no-ratio program; cash-out typically 70–75%
Minimum credit score	660; 700+ improves pricing; 740+ gets the best rates
Loan amount	$150,000 to $3,000,000
Loan terms	30-year fixed, interest-only and ARM options
Prepayment	Usually 1 year; no-prepay and longer-prepay options trade against rate and fees
Residency	Not required — out-of-state investors welcome
LLC vesting	Yes — LLC, corporation or personal name, with a personal guarantee
Short-term rentals	Yes, where local rules allow them
Income documents	None — no tax returns, W-2s, pay stubs or debt-to-income ratio
Closing time	Often about 18 days once documents are complete; appraisal timing varies

Colorado housing market at a glance

Colorado home prices rose 16.0% over the five years to mid-2026, the 49th-largest gain among the 50 states and slower than the U.S. average of 33.4%, according to FHFA’s purchase-only index. About 33.8% of Colorado households rent their home, versus 34.8% nationally.

Measure	Colorado	United States
Households that rent their home	33.8%	34.8%
Median gross rent (per month)	$1,761	$1,413
Median value of owner-occupied homes	$539,400	$332,700
Home-price change, last 5 years (to Q2 2026)	+16.0%	+33.4%
Home-price change, last 12 months (to Q2 2026)	−0.5%	+2.1%
Population, July 1, 2025	6.0 million	341.8 million
Population change since April 2020	+4.1%	+3.1%

Sources: U.S. Census Bureau QuickFacts (renter share, rent and home value are 2020–2024 American Community Survey 5-year estimates; population is the Vintage 2025 estimate) and the FHFA House Price Index (purchase-only, seasonally adjusted, released August 2026).

Worth knowing about Colorado

Colorado hosted 95.4 million visitors in 2024, up from 93.3 million in 2023, with traveler spending of $28.5 billion supporting 188,210 jobs. (Office of Governor Polis: Tourism Industry Contributes $28.5 Billion to Colorado Economy and Supports Over 188,000 Jobs)
In 2025, Denver International Airport ranked first among all U.S. airports for nonstop domestic destinations, and July 2025 was its first month above 8 million passengers. (Denver International Airport: Denver International Airport Celebrates 2025 Milestones)

What rent does a Colorado rental need for a 1.0 DSCR?

At an illustrative 7.25% 30-year fixed rate with 20% down, Colorado’s average property tax rate and our insurance assumption below, a rental priced like the Denver median needs monthly rent of about 0.64% of its price to reach a 1.0 DSCR. Here is what the payment looks like at median prices in Denver, Colorado Springs, Aurora and Fort Collins.

Market	Median price	Monthly PITIA at 20% down (= rent needed for 1.0)	Rent needed as % of price
Denver (Denver County)	$596,716 (Redfin, Sep 2026)	$3,810	0.64%
Colorado Springs (El Paso County)	$454,783 (Redfin, Sep 2026)	$2,980	0.65%
Aurora (Arapahoe County)	$446,787 (Redfin, Sep 2026)	$2,930	0.66%
Fort Collins (Larimer County)	$549,738 (Redfin, Sep 2026)	$3,530	0.64%

Assumptions: 7.25% 30-year fixed (an example, not a quote); property tax at 0.45% of value, Colorado’s average effective rate on owner-occupied homes (rentals don’t get homestead breaks, so an investor’s effective rate is usually higher); insurance at $3,910 a year (NerdWallet’s May 2026 Colorado average homeowners premium); no HOA. Actual county tax rates, premiums and your rate will differ.

How much down do you need to reach 1.0?

If you know a property’s rent-to-price ratio (monthly rent ÷ price), this shows the down payment that gets it to a 1.0 DSCR for a home priced like the Denver median, under the same assumptions.

Monthly rent as % of price	Down payment, 30-year fixed	Down payment, interest-only
0.40%	About 55%	About 49%
0.45%	About 48%	About 41%
0.50%	About 40%	About 32%
0.55%	About 33%	About 24%
0.60%	About 26%	20% (the minimum)
0.65%	20% (the minimum)	20% (the minimum)

If the numbers fall short, there are three other routes: a program that accepts a DSCR down to 0.75 at a higher rate, interest-only payments, or a no-ratio DSCR loan with about 25% down.

Example: a median-priced Denver rental at three structures

The property: a $596,716 rental, the median price in Denver (Denver County).

Costs: property tax about $224 a month and insurance about $326 a month under the assumptions above. Rate is an illustrative 7.25%, an example and not a quote.

Structure	Loan	Monthly PITIA	Rent needed for 1.0
20% down, 30-year fixed	$477,373	$3,810	About $3,810
25% down, 30-year fixed	$447,537	$3,600	About $3,600
25% down, interest-only	$447,537	$3,250	About $3,250

The takeaway: moving from 20% down to 25% down with interest-only lowers the rent this property needs to qualify by about $560 a month. We price each structure side by side so you can compare the extra cash against the rate.

Colorado property tax and insurance: what changes the DSCR

Property tax

Colorado’s average effective property tax rate is about 0.45% of home value for owner-occupied homes, per the Tax Foundation (calendar-year 2022 data). Colorado now uses split residential assessment rates. Boulder County’s assessor lists 7.05% for school district levies and 6.25% for local government levies in 2025, with the local government rate rising to 6.8% in 2026. For 2026 only, the local government value is first reduced by 10% of the first $700,000 of actual value. The sources reviewed describe these rates for residential property in general and do not set a separate rate for non-owner-occupied rentals. Lenders use the tax bill you will actually pay as an investor, so get the county’s estimate for a non-owner-occupied property before you make an offer.

Insurance

NerdWallet puts the typical Colorado homeowners policy at about $3,910 a year, well above its national average of about $2,490. Colorado Division of Insurance data released in February 2026 identifies hail as the largest cost driver, accounting for 26% to 54% of premiums depending on the county, versus 0.9% to 24.6% for wildfire risk. The Colorado FAIR Plan, an insurer of last resort, began writing residential policies on April 10, 2025, with coverage up to $750,000 for owners who have been turned down by three carriers. A rental needs a landlord (dwelling) policy, and the full premium goes into the payment the rent has to cover, so get a real quote early.

Colorado landlord rules that matter to a lender

Rent control: Colorado still bars local rent control on existing private housing under C.R.S. 38-12-301. HB21-1117 (effective September 7, 2021) created a narrow exception for local land-use rules that restrict rents on new or redeveloped units, as long as developers are offered alternatives, and HB23-1115, which would have repealed the ban, failed in 2023.

Evictions: For nonpayment, the landlord must generally serve a written Demand for Rent or Possession giving the tenant 10 days. Properties with certain federal benefits or federally backed mortgages often require 30 days. The landlord cannot file in court until that period ends. The tenant is then served a summons and complaint, the court must enter a judgment, and a sheriff’s deputy carries out the eviction, which usually happens at least ten days after the court’s order.

HB24-1098, effective April 19, 2024, requires cause to evict or to decline to renew a residential lease. The allowed no-fault grounds include demolition or conversion, substantial renovation, the owner or a family member moving in, and leaving the rental market, and no-fault terminations require 90 days’ notice. An amendment dropped the proposed relocation-assistance requirement.

Short-term rental rules in Colorado markets investors ask about

A lender only counts Airbnb or VRBO income if the property can legally operate as a short-term rental. If it can’t, the loan is sized on long-term rent from the appraiser’s rent schedule.

Denver: Denver licenses short-term rentals only at the host’s primary residence, and an investment property that is not the owner’s home cannot get an STR license (it would need a lodging facility license). The license costs a $50 application fee plus $100 a year. Hosts pay the 10.75% lodger’s tax and the $48-a-year occupational privilege tax.
Colorado Springs: Owner-occupied STRs require the owner to live in the home at least 185 days a year. Since December 26, 2019, no new non-owner-occupied permits have been allowed in single-family zones, and in other zones a non-owner-occupied unit must be at least 500 feet from another one. Permits cost $124.95 per listing per year.
Summit County (unincorporated): Unincorporated Summit County caps Type II STR licenses in its Neighborhood Overlay Zone by basin: 590 in Upper Blue, 550 in Lower Blue, 130 in Snake River and 20 in Ten Mile. As of January 2026, Snake River and Ten Mile were over their caps, and Upper Blue, Lower Blue and Snake River had waitlists. Type I licenses for qualifying owners are exempt from the caps.

Rules change often. Confirm the permit status for the exact address with the city or county before you buy.

Other Colorado factors for rental investors

Hail drives Colorado insurance costs. State data from February 2026 attributes 52.5% of premiums in El Paso County (Colorado Springs) to hail, and the Division of Insurance estimates that hail-resistant roofing could save $82 to $387 a year.
Residential assessment rates have been changing every year: 6.25% for local government and 7.05% for schools in 2025, with the local rate rising to 6.8% in 2026, partly offset by a one-year reduction of 10% of the first $700,000 of value.
Denver requires every long-term rental (30 days or more), including single-family homes, to hold a residential rental license. The license requires a passing inspection by a certified third-party inspector, lasts four years unless ownership changes, and costs a $50 application fee plus a license fee of $50 for a single unit.
Colorado’s for-cause eviction law (HB24-1098) means a landlord generally cannot simply decline to renew a lease once a tenant has lived there a year. Selling, renovating, converting or moving in family requires a qualifying no-fault reason and at least 90 days’ notice. Owners renting part of their own single-family home, duplex or triplex are exempt.

Broker vs. direct DSCR lender

A direct DSCR lender can only offer its own program. As a broker, Save Financial compares 20+ DSCR lenders, including lenders active in Colorado, which matters most when a property doesn’t fit the standard box.

	Single direct DSCR lender	Save Financial (broker, 20+ lenders)
Programs available	One lender’s guidelines and rate sheet	Guidelines and pricing from 20+ DSCR lenders, compared for your file
DSCR below 1.0	Only if that lender offers it	A program down to 0.75, plus a no-ratio option
Short-term rental income	That lender’s single method	Matched to the lender whose method gives the strongest qualifying rent
Lease requirement	Usually required on occupied units	One of our lenders uses the appraiser’s market rent with no lease
Reserves	Set by that lender	Cash-out loans generally need none; one lender requires none at all
Prepayment penalty	That lender’s structures	Choose 1-year, no-prepay or longer, priced side by side
How the originator is paid	Built into the rate and fees	Disclosed on your Loan Estimate; when lender-paid, it’s reflected in the rate

Colorado DSCR loan questions

Can I get a DSCR loan in Colorado if I live in California or another state?

Yes. A DSCR loan qualifies on the Colorado property’s rent, not your residency, job or tax returns, so out-of-state investors close Colorado rentals the same way local investors do. Save Financial is a California-based broker that arranges Colorado DSCR loans through lenders active in the state.

What DSCR do lenders require in Colorado?

A DSCR of 1.0 or higher, meaning the rent covers principal, interest, taxes, insurance and any HOA, gets the best pricing. A separate program accepts ratios down to 0.75 at a higher rate, and a no-ratio DSCR loan skips the ratio with about 25% down.

How do Colorado property taxes affect a DSCR loan?

Taxes are part of the payment the rent has to cover. Colorado’s average effective rate is about 0.45% for owner-occupied homes, per the Tax Foundation (calendar-year 2022 data), and rentals don’t get owner-occupant breaks, so an investor’s bill is usually higher. See the property tax section above for how Colorado assesses rentals.

What share of Colorado households rent, and how much have home prices risen?

About 33.8% of Colorado households rent their home (U.S. Census Bureau, 2020–2024), and the median gross rent is $1,761 a month. FHFA data show Colorado home prices rose 16.0% in the five years to mid-2026, versus 33.4% nationally.

Can I use Airbnb income on a Colorado DSCR loan?

Yes, if the property can legally operate as a short-term rental under local rules. Lenders use 12 months of platform payouts, an AirDNA projection (often counted at 75–80%), or fall back to the appraiser’s long-term rent. Check the city rules above before you buy.

Can I close a Colorado DSCR loan in an LLC?

Yes. DSCR loans close in an LLC or corporation with you as personal guarantor. If your LLC was formed in another state, Colorado may require it to register as a foreign LLC before it holds property there; confirm with your attorney or CPA.

Do DSCR loans have prepayment penalties?

Usually. Most of our DSCR loans carry a one-year prepayment period. A no-prepay loan is available at a slightly higher rate or more in fees, and a longer prepayment period can lower your rate or fees.

How long does a Colorado DSCR loan take to close?

Often about 18 days once your documents are complete, though appraisal timing varies. The appraisal with the rent schedule is usually the longest step, and closings can be done remotely or with a mobile notary.

DSCR Loans in Colorado