Net Worth

Net worth is the value of everything a person or company owns minus everything it owes. Conventional mortgages lean on income, and DSCR loans lean on the property, so net worth plays a smaller role. It still matters for reserves, for larger loans and for how a lender views the guarantor.

Some DSCR programs, especially those for bigger loans or multiple properties, look at the borrower's overall financial position as well as the property's rent. Real estate equity counts toward net worth, but lenders tend to care more about the liquid part of it.

Net worth does not enter the ratio. Rent and the payment decide DSCR. A borrower with a large net worth can still be declined when the property covers only 0.90 of its payment, because the loan is underwritten on the property's income, not the borrower's.

Further reading: Net Worth on Wikipedia.