DSCR Loans in Durango, Colorado
Finance La Plata County investment properties on rental income — no tax returns, no W-2.
A dual-engine DSCR market
Durango is a rare DSCR market with two strong income streams. Short-term rentals generated approximately $37,259/year in median revenue in 2025, with average daily rates of $346–$369and 39% occupancy across roughly 1,030 active listings (94.7% entire homes). At the same time, Fort Lewis College drives a steady long-term rental market — student housing, faculty, and workforce demand.
That dual engine means you have options at qualification time. We run both an STR projection and a long-term lease scenario to see which produces the stronger DSCR ratio for your deal.
Purgatory Village DSCR financing
Purgatory Village at Durango Mountain Resort is a condominium hotel — individual units participate in a managed rental program. That single fact eliminates Fannie/Freddie conventional loans, FHA, and VA from consideration. Buyers regularly discover this at underwriting after going under contract with a retail bank, which kills deals.
DSCR is built for this scenario: the lender underwrites the rental income (documented with AirDNA or Rabbu comps), not your employment, and the non-warrantable condo status is handled through portfolio lending. If you're buying a Purgatory Village unit, DSCR is likely your path — Tayton has closed these.
Durango STR permit zones
The City of Durango caps non-owner-occupied STR permits and has restricted new permits in many residential zones. This matters for DSCR because the income projection underpinning the loan depends on the property actually being STR-eligible. Investors must verify current STR permit availability at the subject property's address before going under contract — an "Airbnb-ready" location doesn't equal a permittable one.
Wildfire insurance and DSCR underwriting
Wildfire insurance is a real underwriting issue in La Plata County. Multiple carriers have exited Colorado's mountain markets, and elevated fire-zone properties face higher premiums or insurability problems. DSCR lenders require proof of adequate coverage before closing. Pull insurance quotes as part of the pre-offer checklist — not after going under contract.
STR vs. long-term DSCR in Durango
STR DSCR uses projected rental income but applies a 20% haircut to gross income for qualification. Long-term DSCR uses the actual lease income — no haircut. For some Durango properties, especially near Fort Lewis or in workforce-housing-priced neighborhoods, the long-term math produces a stronger ratio. We run both scenarios side-by-side.
Deeper read: DSCR investment property loans in Durango.
La Plata County conforming limit: $832,750 (2026). See full Colorado loan limits.
Durango financing resources
Durango mortgage broker, VA loans in Durango, second-home & vacation rental financing, DSCR in Steamboat, DSCR in Pagosa Springs.
Closed deals in La Plata County
"Three lenders declined the file because Purgatory is non-warrantable. Tayton placed it as a DSCR loan with a portfolio lender and we closed in 28 days."
"TJ verified STR permit status at the address before I made the offer. Avoided buying a place I couldn't legally rent."
"Used the lease income — no 20% haircut like STR — and the ratio came in stronger. Smart pivot from TJ."
Run the DSCR numbers on your Durango deal
Purgatory condotels welcome. Call or text TJ at 970-708-9624.