Louisiana DSCR Loans & Rates 2026

Louisiana 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

Louisiana housing market at a glance

Louisiana home prices rose 16.3% over the five years to mid-2026, the 48th-largest gain among the 50 states and slower than the U.S. average of 33.4%, according to FHFA’s purchase-only index. About 32.6% of Louisiana households rent their home, versus 34.8% nationally.

Measure	Louisiana	United States
Households that rent their home	32.6%	34.8%
Median gross rent (per month)	$1,064	$1,413
Median value of owner-occupied homes	$216,500	$332,700
Home-price change, last 5 years (to Q2 2026)	+16.3%	+33.4%
Home-price change, last 12 months (to Q2 2026)	+1.6%	+2.1%
Population, July 1, 2025	4.6 million	341.8 million
Population change since April 2020	−0.9%	+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 Louisiana

Louisiana welcomed 45 million domestic and international visitors in 2025, who spent $19.5 billion and supported 225,600 jobs statewide. (Lt. Governor Nungesser kicks off state tour for National Travel & Tourism Week (Louisiana Office of Tourism))
In March 2025, Hyundai Steel announced a $5.8 billion steel mill in Donaldsonville, Ascension Parish, expected to create more than 1,300 direct jobs averaging $95,000 in salary. (Louisiana Economic Development: Governor Jeff Landry & LED Secure $5.8 Billion Hyundai Steel Mill)

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

At an illustrative 7.25% 30-year fixed rate with 20% down, Louisiana’s average property tax rate and our insurance assumption below, a rental priced like the New Orleans median needs monthly rent of about 0.69% of its price to reach a 1.0 DSCR. Here is what the payment looks like at median prices in New Orleans, Baton Rouge and Lafayette.

Market	Median price	Monthly PITIA at 20% down (= rent needed for 1.0)	Rent needed as % of price
New Orleans (Orleans Parish)	$326,844 (Redfin, Sep 2026)	$2,270	0.69%
Baton Rouge (East Baton Rouge Parish)	$249,875 (Redfin, Jul 2026)	$1,810	0.73%
Lafayette (Lafayette Parish)	$247,079 (Redfin, Aug 2026)	$1,800	0.73%

Assumptions: 7.25% 30-year fixed (an example, not a quote); property tax at 0.55% of value, Louisiana’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 $4,033 a year (LendingTree’s Louisiana average homeowners premium; coastal parishes often pay far more); 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 New Orleans median, under the same assumptions.

Monthly rent as % of price	Down payment, 30-year fixed	Down payment, interest-only
0.45%	About 56%	About 50%
0.50%	About 48%	About 42%
0.55%	About 41%	About 34%
0.60%	About 34%	About 25%
0.65%	About 27%	20% (the minimum)
0.70%	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 New Orleans rental at three structures

The property: a $326,844 rental, the median price in New Orleans (Orleans Parish).

Costs: property tax about $150 a month and insurance about $336 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	$261,475	$2,270	About $2,270
25% down, 30-year fixed	$245,133	$2,160	About $2,160
25% down, interest-only	$245,133	$1,970	About $1,970

The takeaway: moving from 20% down to 25% down with interest-only lowers the rent this property needs to qualify by about $300 a month. We price each structure side by side so you can compare the extra cash against the rate.

Louisiana property tax and insurance: what changes the DSCR

Property tax

Louisiana’s average effective property tax rate is about 0.55% of home value for owner-occupied homes, per the Tax Foundation. Louisiana assesses land and residential improvements at 10% of fair market value (La. Const. art. VII, § 18). An owner-occupied homestead is exempt from state, parish and special property taxes on the first $7,500 of assessed value (about $75,000 of market value; municipal taxes are generally not covered, except in Orleans Parish), but a non-owner-occupied rental does not qualify and is taxed on its full assessed value (art. VII, § 20). Every property must be reappraised at least once every four years, and the four-year phase-in for large jumps in assessed value applies only to homestead property (art. VII, § 18(F)). 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

LendingTree puts Louisiana’s average homeowners premium at $4,033 a year, 44% above its $2,801 national average. Louisiana Citizens, the state’s insurer of last resort, raised personal-lines rates by an average of 3.1% statewide on January 1, 2026: the FAIR Plan went up 3.4% and Coastal Plan policies went down 2.5%. The Louisiana Department of Insurance has issued FORTIFIED benchmarks that cut the hurricane portion of a premium by up to 49% (Gold, south Louisiana), and insurers must apply them by January 1, 2027. The state’s Fortify Homes Program offers grants of up to $10,000 toward a FORTIFIED roof. 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.

Louisiana landlord rules that matter to a lender

Rent control: Louisiana has no statute that expressly bans rent control. Instead, R.S. 9:3258 says a lessor’s Civil Code lease rights cannot be changed or reduced except by state law, subject to reasonable police power, which in practice keeps parishes and cities from setting their own rent rules.

Evictions: Once the tenant’s right to occupy ends, whether for nonpayment, lease expiration or another reason, the landlord must deliver a written notice to vacate allowing at least five days (La. C.C.P. art. 4701). A 1997 Attorney General opinion reads this as five legal days, not calendar days. The lease may waive this notice in writing. If the tenant stays, the landlord files a rule to show cause stating the grounds (art. 4731). The hearing can be set no earlier than the third day after service, and if the landlord wins, the court enters a judgment of eviction immediately (art. 4732). If the tenant does not leave within 24 hours of the judgment, the court issues a warrant for the sheriff, constable or marshal to return possession (art. 4733). An appeal stops execution only if the tenant answered under oath with an affirmative defense and filed for appeal and bond within 24 hours (art. 4735).

The landlord must return a residential security deposit within one month after the lease ends; if any part is kept, an itemized statement is due within one month, or at the latest 15 days after that one-month mark (R.S. 9:3251, as amended in 2026). A willful failure exposes the landlord to the greater of $300 or twice the amount wrongly kept (R.S. 9:3252).

Short-term rental rules in Louisiana 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.

New Orleans: In residential areas, the only available permit is the Non-Commercial STR (NSTR). Its operator must be the owner-occupant living on the lot, and the city’s owner application requires a homestead exemption on the property. That means non-owner-occupied whole-home investor STRs are not allowed in residential zones. The city issues NSTR permits through lotteries; the most recent was held in October 2026. Commercial STRs are for commercial and mixed-use zones and need a conditional use approval.
Baton Rouge (East Baton Rouge Parish): Owner-occupied STRs need no permit, but the owner must have a homestead exemption, be on site during stays, and keep one bedroom for themselves. Every other STR needs a $100 Non-Owner-Occupied STR permit from Permits and Inspections, with one parking space per rental bedroom and a cap of two guests per bedroom plus two. All operators must register to remit sales, use and occupancy taxes or use a platform that remits them, and three adjudicated violations in a calendar year suspend operation for one year.
Lafayette: STRs in the City of Lafayette need an annual license that costs $100 and expires December 31, and the city’s 2024 application packet bars them in RS-1 single-family zones (confirm current zoning with Lafayette Consolidated Government). Applicants must notify adjacent owners, register for sales tax, show that no taxes or fees are owed, and name a 24/7 local contact. The application asks whether the unit is owner-occupied but does not ban non-owner-occupied rentals. State and local sales taxes apply to stays.

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

Other Louisiana factors for rental investors

Louisiana assesses residential property at 10% of market value, and the $7,500 homestead exemption on assessed value goes only to owner-occupants. A DSCR rental therefore pays tax on its full assessed value, so do not underwrite it using an owner-occupant’s tax bill (La. Const. art. VII, §§ 18, 20).
Unless a lease waives it in writing, the notice to vacate is only five days, and the eviction hearing can be held as soon as three days after service. An appeal halts eviction only if the tenant posts bond within 24 hours (La. C.C.P. arts. 4701, 4732, 4735).
Under Louisiana Department of Insurance benchmarks, insurers must apply FORTIFIED discounts to the hurricane portion of a premium by January 1, 2027, ranging from 16% to 49% depending on region and FORTIFIED level, which can change a coastal rental’s insurance cost and its DSCR.
Louisiana Citizens personal-lines rates went up an average of 3.1% statewide on January 1, 2026 (FAIR Plan +3.4%, Coastal Plan -2.5%).

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 Louisiana, 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

Louisiana DSCR loan questions

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

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

What DSCR do lenders require in Louisiana?

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 Louisiana property taxes affect a DSCR loan?

Taxes are part of the payment the rent has to cover. Louisiana’s average effective rate is about 0.55% for owner-occupied homes, per the Tax Foundation, and rentals don’t get owner-occupant breaks, so an investor’s bill is usually higher. See the property tax section above for how Louisiana assesses rentals.

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

About 32.6% of Louisiana households rent their home (U.S. Census Bureau, 2020–2024), and the median gross rent is $1,064 a month. FHFA data show Louisiana home prices rose 16.3% in the five years to mid-2026, versus 33.4% nationally.

Can I use Airbnb income on a Louisiana 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 Louisiana 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, Louisiana 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 Louisiana 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 Louisiana