Colorado's combination of population growth, supply constraints, strong employment, and no state rent control creates a structurally sound rental market — but investment financing is meaningfully different from primary residences.
Conventional Investment
15% down (1-unit) or 25% (2–4 unit) · 680+ credit (720+ for best pricing) · 0.5–0.75% rate premium vs. primary · 6 months PITIA reserves · Up to 10 Fannie/Freddie-financed properties · Loan amounts to county conforming limits ($766,550–$1,089,050). Works best for W-2 investors with clean returns.
DSCR Loans (Game-Changer for Scaling Investors)
Qualifies on property income, not W-2 or tax returns. DSCR = Rent ÷ PITIA. Target ≥ 1.0 (some lenders to 0.75 with larger down). 20–25% down · 680+ credit · 6–12 months reserves · 3–5 year prepay step-down common · no cap on financed properties.
Example: Fort Collins duplex at $620K renting $4,500/mo total. 25% down ($155K) → $465K loan at ~7.5% → ~$3,255 PITIA. DSCR = 1.38 — strong qualifier. See DSCR loans.
Portfolio & Blanket Loans
Portfolio: no conforming constraints, unusual property types, more flexible underwriting (0.5–1.5% rate premium vs. DSCR). Blanket loans cover multiple Colorado properties under one note — simpler management but requires release clauses for individual sales.
Best Colorado Investment Markets 2026
Colorado Springs: Fort Carson rental demand, DSCR 1.1–1.3. Pueblo: Highest cap rates in the state, DSCR 1.2–1.5. Fort Collins: CSU demand, duplex/house-hack works. Grand Junction: Affordable acquisition, DSCR 1.1–1.3. Steamboat/Breckenridge/Vail: STR-focused; strong DSCR when STR income qualifies.
Contact Tayton Capital or apply now.
📧 tj@taytoncapitalllc.com
📞 970-708-9624
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Frequently asked questions
What is the minimum down payment for an investment property in Colorado?
Conventional: 15% for single-family, 25% for 2–4 unit. DSCR: 20–25%. Portfolio: 25–35%.
Can I use rental income to qualify for an investment property loan?
Yes — with a DSCR loan, the property's rental income is the primary qualification. No W-2 or tax returns required.
How many investment properties can I finance conventionally?
Fannie/Freddie allow up to 10 financed properties. Above 10, DSCR and portfolio products are the path.
What is the best Colorado market for rental DSCR in 2026?
Pueblo offers Colorado's strongest DSCR ratios due to low acquisition costs. Colorado Springs and Grand Junction also produce strong ratios; Steamboat and Breckenridge for STR.
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