Can I count a lease signed last week?

Yes, though a very new lease — especially to a related party — is checked against the market rent opinion.

Do tenant-paid utilities count as rent?

Only where the lease and the rent schedule both support it. Assume not.

What if my tenant pays late?

Payment history can be requested. Consistent late payment invites questions but is not automatically disqualifying.

Can I use projected rent after renovation?

No. The rent schedule reflects the property as it stands on the appraisal date.

Does Section 8 rent count?

Generally yes, evidenced by the housing assistance payment contract. Treatment varies by lender.

LESSON 2 OF 64 MIN READ

Which rent counts — the lease, market rent, or the appraiser's schedule?

Underwriting uses the lower of your in-place lease rent and the appraiser's opinion of market rent on a leased unit, and the appraiser's Form 1007 market rent — often with a modest haircut — on a vacant one. The rule exists because an above-market lease can be written by anyone; a market-rent opinion is evidence from outside the transaction. When the two disagree materially, the file is decided by the appraisal, not by the lease, unless you can rebut the rent schedule with better comparable data.

THE NUMBERS

Minimum DSCR	0.75 (0.75–0.99 prices at +62.5 bps, 70% LTV cap)
Maximum LTV	80% purchase or rate-and-term · 75% cash-out
FICO floor	660 (below that the desk does not lend)
Loan size	$100K – $3M single · $10M portfolio
Reserves	6 months PITIA · 12 months on a portfolio
Prepay options	5-4-3-2-1 par · 3-2-1 +25 bps · 1-yr +50 bps · none +87.5 bps
Typical days to close	21–30 days from a signed term sheet
Rate sheet	Silt Rate Desk — Market Composite Sept 2026 · effective 2026-09-01

ILLUSTRATIVE — published program floors, not a quote or a commitment to lend. Subject to underwriting, appraisal and final credit approval.

What Form 1007 actually is

Form 1007 is the single-family comparable rent schedule: the appraiser lists comparable rentals, adjusts them for size, condition and amenities, and states an opinion of monthly market rent for the subject. On a 2–4 unit, Form 1025 does the same job unit by unit. It is ordered alongside the appraisal, and on a DSCR file it is not optional — it is the income document. Read it as carefully as you read the value conclusion, because it drives the ratio.

Why the lower figure usually governs

If the lease governed, a borrower could sign a $4,000 lease with a cooperative tenant on a $2,500 house and manufacture an approval. Taking the lower of the two closes that door. It also protects you: a ratio built on rent that the market will not sustain becomes a payment problem at the first turnover. The practical implication is that a below-market lease hurts you and an above-market lease does not help you — so the time to raise rent is before the appraisal, not after it.

When above-market rent can still count

Occasionally the lease is right and the rent schedule is stale — a fully renovated unit compared against tired ones, or a furnished mid-term rental compared against unfurnished stock. That is a rebuttal, and it succeeds on evidence: three or four genuinely comparable current listings or signed leases, photographs of the finish level, and a short written explanation. Send it through the desk to the appraiser. Practice varies by lender on how readily a rent rebuttal is accepted.

Vacant units and the haircut

With no lease, the market rent opinion carries the income, commonly with a small reduction to reflect the absence of a paying tenant. That is why a vacant property often prices thinner than the same property leased. If the unit will be leased within weeks, leasing it before the appraisal — at market, with a signed agreement and a deposit — is usually the cheapest ratio improvement available.

Short-term rental income

There is no lease, so the basis is twelve months of documented platform revenue, taken gross, from statements rather than a projection screenshot. Newer operations with less history are harder, and market-data estimates alone are generally not enough on their own. The program carries a 37.5 basis point adjustment, and the property must be legal to operate short-term where it sits.

The gross-rent rule

Whatever the source, the figure is gross scheduled rent — before management fees, before a vacancy allowance, before maintenance. Residential DSCR is not a net-operating-income underwrite. Do not deduct anything before dividing, and do not add back tenant-paid utilities or pet fees unless the lease and the rent schedule both support them.

The lease and the appraiser disagree

In-place lease	$3,100 / mo
Appraiser's Form 1007 market rent	$2,750 / mo
Qualifying rent used	$2,750 / mo — the lower
PITIA	$2,540 / mo
DSCR at lease rent	1.22
DSCR at qualifying rent	1.08
Pricing effect	Falls from par band to +0.25%

A successful rent rebuttal here — evidencing $3,000 of genuine market rent — recovers the band. Illustrative only.

WHAT WE NEED FROM YOU

Signed leases for every unit. With any addenda and the most recent payment evidence.
Rent roll. On a 2–4 unit or a portfolio, unit by unit.
Platform revenue statements. Twelve months, for a short-term rental.
Rebuttal comparables. Where you believe the rent schedule is understated.

FREQUENT QUESTIONS

Can I count a lease signed last week?: Yes, though a very new lease — especially to a related party — is checked against the market rent opinion.
Do tenant-paid utilities count as rent?: Only where the lease and the rent schedule both support it. Assume not.
What if my tenant pays late?: Payment history can be requested. Consistent late payment invites questions but is not automatically disqualifying.
Can I use projected rent after renovation?: No. The rent schedule reflects the property as it stands on the appraisal date.
Does Section 8 rent count?: Generally yes, evidenced by the housing assistance payment contract. Treatment varies by lender.

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How DSCR is calculated Short-term rental income Appraisals and the 1007 All answers