Foreign National vs DSCR Loan for Canadians Buying in Florida

Two Programs, Two Qualification Paths

Canadian buyers looking at Florida property encounter two primary mortgage programs designed for international borrowers: the foreign national mortgage and the DSCR (Debt Service Coverage Ratio) investor loan. Both are available to Canadians who generally do not have a U.S. Social Security Number or U.S. credit history. Both accept Canadian documentation. But they qualify borrowers in fundamentally different ways, and the right choice depends on how you intend to use the property.

A foreign national mortgage evaluates you — your income, your credit, your assets. A DSCR loan evaluates the property — its rental income, its expenses, its cash flow. This distinction drives every difference in qualification, documentation, and program structure.

Side-by-Side Comparison

Feature	Foreign National Mortgage	DSCR Investor Loan
Qualification basis	Borrower's personal income, credit, and assets	Property's rental income vs. mortgage payment (DSCR ratio)
Intended property use	Second home, vacation home, or investment property	Investment / rental property only (not personal residence)
Income documentation	Canadian T4, NOA, T1 returns, employment letter, or business financials	Generally not required — qualification based on property rental income
Credit requirements	Canadian credit report required; approximately 680+ score typically expected (varies by lender)	Canadian credit report required; approximately 680+ typically expected (varies by lender)
U.S. SSN required?	Generally not required through foreign national programs	Generally not required through DSCR programs
Down payment	Approximately 20–25% (second home) to 25–30% (investment), subject to lender guidelines	Approximately 25–30%, may vary based on DSCR ratio and lender
Loan amounts	Typically $100K to $5M+ with select lenders	Typically $100K to $3M+ with select lenders
Rental restrictions	Second home: limited seasonal rental. Investment: no restrictions.	No rental restrictions — property must generate rental income
Interest rates	Typically 0.5–1.5% above conforming rates (varies by scenario)	Typically 0.5–2.0% above conforming rates (varies by DSCR ratio)
Self-employed borrowers	Bank statement program available (12–24 months statements)	No personal income docs typically needed — property qualifies itself
Portfolio scalability	Each property adds to personal debt load, potentially limiting future borrowing	Each property evaluated independently — no cumulative personal debt impact
Closing timeline	Typically 30–45 days	Typically 30–45 days
Property types	Single-family, townhome, condo (warrantable & non-warrantable), multi-family	Single-family, townhome, condo, multi-family, short-term rental (Airbnb/VRBO)

Which Program Fits Your Situation?

Can You Use Both Programs?

Yes. Many Canadian buyers who work with Cross Border Loans use both programs as part of a broader Florida real estate strategy. A typical structure is a foreign national second home mortgage for a personal winter residence in Boca Raton, combined with one or more DSCR-financed investment properties generating rental income in other Florida markets.

The two programs complement each other because they evaluate different things. Your personal debt capacity (relevant for the foreign national mortgage) is separate from the investment property's cash flow (relevant for DSCR). This means financing a second home does not diminish your ability to qualify for DSCR investment loans, and vice versa.

Documentation Comparison for Canadian Borrowers

Foreign National Mortgage — What You Provide

Canadian passport, Canadian credit report (Equifax or TransUnion Canada), T4 slips and Notice of Assessment (or T1 General), employment letter or business financials for self-employed, Canadian bank statements showing down payment and reserves (typically 60–90 days), and any existing Canadian property or mortgage documentation. For Canadian buyers, this documentation package is familiar — it mirrors what Canadian lenders request for domestic mortgages.

DSCR Loan — What You Provide

Canadian passport, Canadian credit report, proof of down payment funds, and documentation of the property's rental income potential — either existing lease agreements or a market rent analysis (appraisal-based or from platforms such as AirDNA for short-term rentals). Personal income documentation is generally not required. This makes the DSCR application significantly simpler for borrowers with complex income situations.

Rate and Cost Considerations

Both foreign national and DSCR programs carry rates above standard U.S. conforming mortgage rates, reflecting the additional underwriting involved with international borrowers. The exact rate differential depends on the lender, borrower profile, property type, LTV ratio, and in the case of DSCR loans, the coverage ratio.

As a general framework: foreign national second home rates tend to be more favorable than DSCR investment property rates, because second homes are considered lower risk than rental properties. However, DSCR loans with strong coverage ratios (1.25x or above) may achieve rates close to foreign national programs. The rate difference between programs is typically modest — David Nataf at Cross Border Loans in Boca Raton runs pricing comparisons across multiple lenders for each scenario to identify the most competitive option.

Florida Markets — Program Fit by Location

Certain Florida markets naturally align with one program over the other based on property characteristics and typical buyer intent. South Florida markets like Boca Raton, Fort Lauderdale, and Naples attract snowbirds seeking personal-use winter homes — foreign national programs are the natural fit. Orlando, Kissimmee, and Miami Beach draw investors targeting short-term rental income from tourism — DSCR programs are often more advantageous. Markets like Sarasota, Tampa, and the Palm Beaches serve both segments, making program selection dependent on the individual buyer's intent.