Comparable Rent Schedule (Form 1007): What It Is and How DSCR Lenders Use It

A comparable rent schedule is the appraisal form that estimates what your property should rent for. On a single family rental it is Fannie Mae Form 1007, the Single-Family Comparable Rent Schedule, which is why an appraisal rent schedule and a single family comparable rent schedule are usually the same document. Your DSCR lender orders it alongside the appraisal, and the market rent it reports is often the number that lands in the top of your ratio.

The appraisal sets value. The rent schedule sets income. If you want the value side, real estate appraisal covers how that works. This page is about the rent side, because on a DSCR loan the rent figure decides whether the deal funds.

What is a comparable rent schedule?

It is a short addendum to the appraisal report. The appraiser lists rent comparables, usually three, that are leased right now, adjusts each one for differences against your property, and reports a single monthly market rent. The form also records whether your property is occupied, what the current tenant pays, and when that lease ends.

So two numbers come out of it: market rent, meaning what the appraiser believes the property rents for today on a standard unfurnished lease, and actual rent, meaning what is being collected. Underwriting compares them.

Form 1007 vs Form 1025: which one your property gets

Form 1007 covers one unit properties: single family houses, condos and townhouses. Freddie Mac numbers the same form 1000. It attaches to the main appraisal report, Form 1004 for a house or Form 1073 for a condo. On its own it is not an appraisal and it does not state a value.

Form 1025 is a different animal. It is the full appraisal report for a two to four unit property, and it has rent comparables built into it, so a duplex or a fourplex does not normally get a separate 1007. On small multifamily, lenders often pair it with Form 216, the Operating Income Statement.

Unit count decides which form the appraiser uses. Ask your loan officer which forms are on the appraisal order before it goes out. A missing 1007 on a vacant single family is a common reason a file stalls in underwriting, and reordering costs a week. It is also worth knowing that a rent schedule does not always come with a full interior appraisal, which is part of what the answer to getting a DSCR loan without an appraisal turns on.

How the appraiser picks rent comparables

Same logic as sales comps, different data set. The appraiser looks for properties leased recently, close by, similar in bedrooms, bathrooms, square footage, age, condition and features like a garage, a fenced yard or in unit laundry. Each comp then gets adjusted up or down so it reads as if it matched your property.

Two things about this process catch owners by surprise.

First, the comp pool is thinner than for sales. Closed sales are recorded publicly. Leases are not. The appraiser works from rental listings, property management sources and their own files. In markets where landlords rent privately and never list, the estimate rests on fewer data points and the spread between two appraisers can be wide.

Second, the form measures long term unfurnished rent. A short term rental running well above long term rent will not show up here. That income needs a different document, usually a twelve month history, and a lender program that accepts it.

How the market rent figure sets your DSCR

Take the site default. A $500,000 rental at $4,000 a month, $6,000 a year in property taxes and $2,500 in insurance. With 25% down at 7.5%, principal and interest run $2,622 a month, taxes and insurance add $708, and PITIA is $3,330. That is a DSCR of 1.20. On the calculator’s simple tab, where you enter the payment yourself, $4,000 of rent against a $3,200 payment gives 1.25.

Now suppose the rent schedule comes back at $3,600 instead of $4,000. Nothing about the property changed. The payment did not change. But if the lender uses the lower of lease and market rent, the ratio drops to 1.08.

That single line moves the file from comfortably above a 1.20 DSCR requirement to a deal that needs restructuring. The mechanics of why are in the DSCR formula: rent is the whole numerator, so every dollar of market rent is a dollar of qualifying income.

What to do when the rent schedule comes back low

Read the comps before you react

Check the basics first. Wrong bedroom count, wrong square footage, a comp pulled from a weaker submarket, an adjustment that runs the wrong direction. Factual errors are the ones that get corrected.

Rebut with evidence, through the lender

Send your signed lease, active listings for similar homes nearby, and a property manager’s written opinion of rent. Route it through your loan officer or the appraisal desk. Contacting the appraiser directly is not allowed.

Put more down

Staying with $3,600 of market rent, reaching 1.20 means getting PITIA to about $3,000, which means a loan near $327,800 at 7.5%. That is roughly 34.5% down, about $47,000 more cash than the 25% version.

Change the payment structure

An interest only payment on the same $375,000 loan at 7.5% is $2,344, and PITIA becomes about $3,052. At $3,600 of rent the ratio moves from 1.08 to 1.18. Often enough to clear a 1.15 threshold without more cash.

Work the lines the loan does not control

Taxes and insurance are the only parts of PITIA you can shop. A quoted tax figure based on a stale assessment, or a placeholder insurance premium, is worth challenging before you accept the ratio.

It cuts both ways. On a vacant property, a rent schedule that comes back above your own estimate raises the ratio and can lower your down payment.

Run your own numbers

Plug the market rent from your rent schedule into the DSCR Loan Calculator on the home page, next to your taxes, insurance and loan terms. Then enter the rent you expected and compare. The gap between the two ratios tells you exactly how much a low rent schedule costs you, in down payment or in rate, before you decide whether to rebut it or reprice the deal.