A four-unit property is one of the most important asset types in Massachusetts investor lending. It can still be reviewed in many residential DSCR programs, but the income and expense profile starts to behave like small multifamily.
The key number is DSCR, or Debt Service Coverage Ratio. DSCR tells the lender whether the property income can support the proposed debt after principal, interest, taxes, insurance, and applicable fees are counted.
Home / Investor Insights / How to Calculate DSCR for a 4-Unit Property in Massachusetts 2026
Investor Insights | By Joe Galvin | Published 2026-06-06 | Updated 2026-06-06
DSCR equals monthly rental income divided by monthly PITIA. PITIA means principal, interest, taxes, insurance, and association fees if applicable.
Example: $8,000 in monthly rent divided by $5,950 in PITIA equals a 1.34 DSCR. That means the property produces roughly 34 percent more income than the proposed monthly housing expense.
Assume a Haverhill four-family has four market-rate units producing $2,000 per unit, or $8,000 per month. If taxes, insurance, and the proposed loan payment total $5,950 per month, the DSCR is 1.34.
That is not an approval promise. It is the starting point for review. IMC would still review valuation, rent support, credit, reserves, entity structure, title, insurance, and the investor exit strategy.
The biggest movers in Massachusetts are rent support, property taxes, insurance, loan amount, rate environment, and whether the property has vacancy or below-market leases.
A four-unit in Lawrence, Lowell, Haverhill, Methuen, Worcester, or Lynn can look strong on rent and still tighten up when taxes or insurance are fully counted.
A 1.00 DSCR means the rent covers the monthly PITIA at break-even. A 1.20 to 1.25 DSCR is stronger for many standard investor programs. Below 1.00 may need lower leverage, stronger reserves, a no-ratio option, or a bridge-to-stabilization path.
The most common four-unit DSCR problems are unsupported market rent, missing leases, underestimated insurance, high taxes, too much cash-out, thin reserves, and treating a vacant value-add building like a stabilized rental.
Send IMC the address, rent roll, purchase price or value, loan request, taxes, insurance estimate, and timeline before assuming the deal fits.
| Situation | Likely Path |
|---|---|
| 1.25x or higher | Stronger range for many standard DSCR reviews |
| 1.00x to 1.24x | Possible fit, but structure and reserves matter |
| Below 1.00x | May need lower leverage, bridge, no-ratio, or a different exit |
