Private Lending for Residential Rental Properties
Long-term rental financing has become a popular offering by many private and hard money lenders that have historically focused on short-term lending. Also known as LTR (long-term rental) loans or DSCR (debt service coverage ratio) loans, these private mortgages are a great solution for investors that buy and hold properties for cash flow.
Although the pricing is slightly higher than banks and conventional lenders, there are several reasons why an investor or broker would seek private financing for these investments.
Speed
Private lending is typically much faster than dealing with banks. If you’re on a tight timeline, chances are the loan will fund faster with the non-conventional lender. Most long-term rental loans close in 1 to 3 weeks.
Easier Qualification
The primary qualification for long-term rental loans is the rental income, and more specifically the DSCR, which stands for debt service coverage ratio. Basically, the lender wants to make sure the property’s rental income will cover the monthly mortgage payments. The lender likely won’t ask for tax returns but they do require a decent credit score, typically no less than 680.
No Seasoning Requirements
Most long-term rental lenders do not require the property to be tenant-occupied for a certain number of months before you can get the loan. In fact, the property doesn’t even need to have a signed lease. It just needs to be move-in ready so that the lender can estimate the market rental rate. Some lenders will require a signed lease agreement, but most private/hard money lenders will fund the loan if the property is vacant and listed on the rental market.
No Portfolio Limits
Many conventional lenders won’t lend if you own more than 4 properties, and some will have a limit of 10. In private lending, there are no limits to how many properties the investor can own. However, the lender may require that title be held as an entity (LLC or Corp) and not as an individual.
Typical Terms & Guidelines for Rental Property Loans
Below are some of the general guidelines for most of the DSCR lenders listed on our platform.
- Loan Amounts: $75,000 to $2,000,000
- Loan-to-Value: Up to 75%
- Loan-to-Purchase Price: Up to 80%
- Must have 20%+ cash for the purchase
- No lender on our site provides 100% financing for rentals
- Lien Position: 1st only
- Loan Term: Up to 30 years (some lenders offer 5, 7, or 10 year terms)
- Interest Rate Range: 6.00% to 8.50%
- Origination Fee: 1 to 4 points
- Minimum Credit Score: 600
Credit Score Requirement
Almost all lenders offering long-term rental loans will require the borrower to have a decent FICO score, typically no less than 600. The lender may not care as much about credit scores for short-term loans, but the long-term loans are typically sold on the secondary market, and that is where the credit requirement comes from.
Top 10 DSCR Rental Loan Lenders in the United States
According to SFR Analtyics, here are the top 10 private lending companies that are funding DSCR long-term loans secured by residential rental properties in the United States, along with the approximate loan volume funded. The list ranks each lender by the total loan volume originated from January 2024 to September 2024.
- RCN Capital funded over $1,000,000,000
- American Heritage Lending funded over $830,000,000
- Roc Capital funded over $690,000,000
- Visio Lending funded over $600,000,000
- Renovo Financial funded over $480,000,000
- LendingOne funded over $460,000,000
- Constructive Capital funded over $410,000,000
- Lima One Capital funded over $290,000,000
- Dominion Financial funded over $250,000,000
- Easy Street Capital funded over $210,000,000
Click the links to view each lender’s profile. The lenders without a link do not have an active Lender Link profile. The loan volume amounts mentioned are approximate. Not every loan has maturity data, so some lender’s volume may be higher than shown.
SFR Analtyics provides advanced analytics for top-performing real estate investors and private lenders. Their platform provides nationwide, real-time property data, including market activity, ownership changes, and detailed buyer behavior insights. With custom dashboards and alerts, users can track active investor and lender activity, access rental market information, and analyze geographic and demographic trends. Their Private Lender Radar product gives lenders deep insights into borrower portfolios, lending activity, and verified contact details. For those needing bulk data, they supply updated daily records, including deeds, rental listings, demographic data, and building permits, to support informed decision-making across the residential real estate market.
Long-Term Rental Loan Scenarios
Below are a few scenarios of when a real estate investor may consider getting a long-term loan for their residential rental property.
Purchase, Rehab and Rent
Many real estate investors will buy a house in poor condition, renovate it, and then locate a tenant with a plan of holding on to it as a cash flowing investment. These projects are typically financed with a short-term hard money loan. Once the tenant has signed a lease, the hard money loan can be refinanced and replaced with a 30-year rental loan at a lower interest rate. The maximum loan-to-value is typically 75%, but it could be as high as 80%.
This strategy is commonly known in the real estate investment industry as “BRRRR” which stands for Buy, Rehab, Rent, Refinance, Repeat.
Purchase a Turn-Key Rental
Investors that don’t have any interest in rehabbing a house can purchase a home that is already rented and cash-flowing, commonly known in the real estate investment industry as “turn-key rentals.” There are many real estate investment firms that will do all the dirty work to rehab a property, locate a tenant and manage the property before selling it.
An investor can use a DSCR long-term rental loan to acquire the cash-flowing rental property and hold on to it for many years. Most lenders will require a downpayment of at least 25%.
Cash Out Equity
Real estate investors can tap the equity in one rental home to purchase another house or invest in something else. So long as there is a sufficient amount of equity, the investor can use a private long-term rental loan to get the cash needed.
LTR lenders only offer 1st mortgages, so if there is an existing mortgage, it would have to be refinanced. There is no such thing as a long-term rental 2nd mortgage in private lending. While an investor may be able to get a 2nd mortgage on their rental property, it’s likely not going to have a long term. And the interest rate may be high, so it’s worth exploring a refinance to get the cash out.
Blanket Loan for Multiple Rental Properties
Some private lending firms offer a “blanket loan” secured by multiple rental homes. Also known as rental portfolio loans, this can help investors simplify their financing by consolidating multiple mortgages into one private long-term rental loan. If one property in the portfolio needs to be sold, the lender can do a partial release, and the total loan amount will be reduced.
These blanket loans can be difficult to structure and manage, so it’s not a common offering by private lending companies. Most long-term rental lenders only consider one property. Some will consider up to 10 properties on one loan, and only a few lenders offer blanket loans for a portfolio of more than 10 properties.
Convert Primary Residence to Rental Home
Many homeowners become real estate investors when they are ready to upgrade to a new house. As soon as the previous residence has been rented, a private long-term rental loan can be used to refinance and/or cash out equity.
If the previous residence is used as a 2nd home by the investor, a private lender will not consider it. Even if the home is rented out short-term from time-to-time, it’s still considered a consumer purpose, and private/hard money lenders only offer mortgages for investment purposes.
Short-Term Rental
Investors that operate a short-term rental business on their property may have fewer financing options in private lending. Most lenders that offer long-term rental loans will want there to be an active lease agreement in place. Short-term / vacation rentals may have inconsistent rental income, and this is seen as a higher risk for lenders. If the property is located in a ski resort town or beach city, there may be slow seasons with lower revenue that cannot support the mortgage payment.
That being said, there are some private lenders that will gladly provide a long-term rental loan on a property that is used to operate a short-term rental business. It started becoming a popular loan program in late 2021.
Trends in Private Lending Mid-2025
American Heritage Lending was built by real estate investors seeking a faster, more transparent, and execution-driven lending experience. Since 2004, the company has funded over $1 billion in residential real estate loans across fix & flip, ground-up construction, bridge, DSCR rental, and small multifamily projects. With deep hands-on experience in all facets of real estate lending, American Heritage Lending has developed a reputation for balancing speed, leverage, and reliability of capital, particularly in competitive and complex markets. Below is an excerpt from our interview discussing current market trends in private lending and how borrowers are navigating evolving deal timelines and exit strategies.
Market conditions in mid-2025 reflect evolving deal timelines, minor price adjustments, and longer holding periods. Borrowers are navigating extended construction and rehab schedules while managing rising interest rates, insurance constraints, and carrying costs. Tight inventory levels and changing market dynamics require precise cash flow modeling and underwriting to ensure margins are maintained for both fix & flip and ground-up construction projects.
Borrowers are increasingly utilizing DSCR loans as a core exit strategy, converting stabilized properties into income-generating assets. Refinancing short-term bridge or construction loans into long-term DSCR structures mitigates rollover risk, ensures predictable debt-service coverage, and provides scalable cash flow opportunities for single-family and small multifamily portfolios.
Portfolio structuring is becoming more common, particularly for investors executing multiple-unit rehab or built-to-rent strategies. Aggregating properties into a single portfolio loan enhances operational efficiency, improves risk diversification, and allows for streamlined underwriting. This approach supports investors looking to scale their holdings while maintaining favorable leverage and cash flow coverage.
Underwriting is guided by detailed market analytics, including absorption rates, local supply-demand trends, and cap rate metrics. Asset selection spans townhomes, detached single-family homes, and small multifamily units, with verified GC partnerships and prior construction experience evaluated to reduce execution risk. These factors ensure alignment with community-level liquidity and investor risk appetite while supporting sustainable long-term returns.
Leverage parameters remain project- and portfolio-specific. Maximum exposure per single asset typically caps at $2.5 million, while portfolio DSCR loans can accommodate $20 million across multiple units. Minimum loan thresholds generally start at $100K, providing entry points for investors of varying experience levels, while loan-to-cost and loan-to-value ratios are tailored to balance project complexity, borrower capacity, and projected cash flows.
DSCR Loan Program Changes in 2025
DSCR loan programs in 2025 have expanded significantly, reflecting broader acceptance of previously restricted property types, including short-term rentals and BRRRR strategies. American Heritage Lending has implemented underwriting tools to properly assess these assets, addressing challenges such as seasoning requirements and rental income verification. Innovative program features, like fee stacking, allow borrowers to reduce interest costs and monthly payments while maintaining capital efficiency throughout the loan term.
Loan sizes and leverage parameters have increased, with maximum LTVs on purchases reaching up to 85% for high-FICO, high-DSCR borrowers. Portfolio diversification and risk assessment remain central, ensuring that elevated loan amounts—sometimes exceeding $2–3 million—are paired with sufficient debt-service coverage. Cash-out refinances generally remain more conservative, with LTVs capped around 75%, balancing borrower needs with lender risk management.
Multifamily financing is evolving, with American Heritage Lending introducing a new five-to-ten-unit addendum to their DSCR program. This expansion addresses an underserved mid-market segment, enabling investors to finance small multifamily portfolios under tailored underwriting criteria. Although LTVs for these transactions are slightly reduced compared to one-to-four-unit deals, the program provides structured, scalable opportunities for investors seeking passive rental income and long-term portfolio growth.
Underwriting remains property- and borrower-specific, incorporating factors like vacancy rates, operational expenses, and local market conditions. The combination of high-quality appraisals, rigorous loan documentation, and conservative risk assumptions ensures that both single-family and small multifamily DSCR loans perform predictably, even as the market continues to evolve and investor demand shifts.
40-Year DSCR Loan Program
Term flexibility is a hallmark of the 40-year DSCR loan program, designed to maximize cash flow for residential real estate investors. The initial ten years are structured as interest-only, followed by a 30-year fixed amortization period. This approach reduces early principal payments, allowing borrowers to preserve capital for reinvestment or portfolio expansion while benefiting from predictable monthly cash flow.
Qualification standards remain rigorous yet accessible for high-performing investors. Borrowers typically need a 700–720 FICO score and a strong DSCR profile. The extended term makes it easier to underwrite properties against rental income, improving cash flow coverage ratios and supporting a wider range of investment scenarios, from single-family rentals to small multifamily portfolios.
Strategy considerations are critical for choosing between 30- and 40-year terms. Investors prioritizing immediate cash flow often prefer the 40-year term, while more conservative borrowers seeking accelerated debt elimination may opt for shorter terms. This flexibility allows American Heritage Lending to tailor financing solutions to the borrower’s investment philosophy, risk tolerance, and long-term portfolio goals.
Cash flow management benefits are particularly pronounced in markets with rising interest rates or tight capital availability. By keeping payments lower during the early years, borrowers can more easily absorb market fluctuations, reinvest in additional properties, or refinance strategically, ensuring the DSCR loan remains a scalable and efficient tool for long-term passive income generation.
DSCR Loans for Short-Term Rentals
Regulation has historically been the primary barrier to short-term rental (STR) DSCR financing. Many municipalities initially restricted or outright banned vacation rentals, creating significant legal and operational risk for lenders. Over time, these restrictions have eased in key markets, allowing lenders like American Heritage Lending to evaluate short-term rental revenue streams on a more standardized, economic basis rather than purely regulatory concerns.
Experience is a critical component for borrower qualification in STR DSCR loans. Investors are generally required to have owned and operated a short-term rental for at least 12 months, demonstrating proficiency in occupancy management, seasonal cash flow fluctuations, and operational budgeting. This ensures that borrowers can accurately project rental income and maintain profitability under variable market conditions.
Valuation and underwriting practices for STR properties emphasize income potential relative to long-term rental equivalents. While upfront costs such as furnishing and marketing may be higher, short-term rentals can generate substantially elevated returns, sometimes exceeding 30–50% over traditional rental income. Lenders incorporate these projections into DSCR calculations, ensuring that debt service remains manageable even with the inherent variability of short-term rental operations.
Scalability considerations also play a role when borrowers seek to expand into new markets. Experience in one market, such as Gatlinburg, Tennessee, can be leveraged when acquiring comparable properties in similar locations, provided occupancy and revenue metrics align. This approach allows investors to grow portfolios across multiple short-term rental properties while maintaining strong DSCR performance and lender confidence.
DSCR Loan Fee Stacking and Prepayment Penalty
Fee stacking has become an important tool for borrowers looking to optimize DSCR loan terms. By financing discount points directly into the loan balance, investors can reduce their interest rate without paying large sums out-of-pocket. This approach allows borrowers to lower their monthly debt service while maintaining liquidity for property improvements or operational needs.
Origination flexibility is another key advantage. American Heritage Lending enables brokers to include their fees within the loan structure, meaning that borrowers can access professional services and still avoid upfront cash expenditures. This capability supports both broker relationships and borrower convenience, streamlining the overall financing process.
Prepayment penalties are tailored to balance borrower flexibility with lender risk management. While traditional DSCR loans often used a 3–2–1 step-down structure, AHL now offers a range of options, from one-year fixed penalties to five-year variations. Borrowers can select terms based on anticipated market conditions, allowing them to refinance or exit strategically without unduly impacting cash flow.
Customization ensures that each DSCR loan aligns with an investor’s unique strategy. Whether the goal is a lower interest rate, minimal prepayment exposure, or inclusion of broker fees, AHL’s approach provides structured solutions that accommodate varying investment horizons, risk tolerance, and portfolio objectives.
DSCR Loans for Rural Properties
Location plays a critical role in DSCR loan eligibility for rural properties. While traditional metrics such as metropolitan statistical area (MSA) populations are used—generally requiring at least 10,000 residents—AHL also considers practical indicators of marketability. Factors such as proximity to amenities, road access, and availability of comparable rental properties are essential in assessing whether a property can sustain predictable cash flow. Even properties located an hour outside a major metro area can qualify if sufficient rental comps exist.
Acreage is another important consideration. Standard guidelines limit properties to five acres, though exceptions can be made for estate-style homes or unique rural investments. Loans are underwritten to ensure that larger parcels still generate consistent rental income and meet debt-service coverage requirements, with potential adjustments to LTV or other underwriting parameters.
Marketability and tenant demographics are also critical. Investors must demonstrate that potential renters exist for the property, and that the asset can operate successfully as a rental despite its rural location. This may involve analyzing local employment centers, seasonal occupancy patterns, and the overall desirability of the location. AHL combines these qualitative and quantitative factors to determine whether a rural property meets DSCR standards while supporting long-term investor cash flow.
Minimum Credit Score for DSCR Rental Loans
Credit is a key factor in qualifying for DSCR rental loans. American Heritage Lending generally requires a minimum FICO score of 680, though exceptions can occasionally be made for borrowers with strong payment histories and temporary high credit utilization. Scores below 680 are evaluated on a case-by-case basis, particularly when credit activity reflects strategic borrowing for investment purposes rather than missed obligations.
Underwriting relies on a single-point evaluation at loan submission or origination, ensuring that credit assessment is fast and efficient. Unlike traditional loans that may require score seasoning over time, AHL focuses on the borrower’s current credit health, simplifying approval timelines without sacrificing risk management.
Pricing remains sensitive to credit quality through an LTV-FICO grid, where higher loan-to-value ratios or lower credit scores may result in higher rates. Conversely, borrowers with strong credit profiles can achieve more favorable terms, reinforcing the importance of maintaining a solid credit foundation when pursuing DSCR financing.
Rate Locks for DSCR Rental Loans
Rate locks are an integral part of American Heritage Lending’s DSCR loan programs, offering borrowers a guaranteed interest rate for up to 45 days. This ensures investors can move forward with confidence even amid fluctuating market conditions, knowing their financing terms are secured during the often-complex underwriting and closing process. For many real estate investors, this stability can make the difference in executing a time-sensitive acquisition or refinancing strategy.
Flexibility with rate adjustments, commonly known as float-downs, is handled thoughtfully on a case-by-case basis. Because DSCR loans are non-QM and harder to hedge in secondary markets, a programmatic float-down isn’t always possible. However, AHL evaluates requests individually, providing opportunities for borrowers to take advantage of lower rates when market conditions allow, without exposing the lender to unnecessary risk.
Commitment to a rate lock generally occurs when the loan enters underwriting and all borrower agreements, fees, and broker compensation structures are confirmed. Even if the process takes several weeks, the initially locked rate remains protected, giving investors’ confidence in long-term cash flow projections and investment planning. This structured approach to rate locks allows borrowers to focus on property performance rather than worrying about day-to-day interest rate volatility.
American Heritage Lending has funded over $1 billion in residential real estate loans since 2004. The platform provides financing solutions across fix & flip, ground-up construction, bridge, DSCR rental, and small multifamily assets, with features including high leverage options, fast draw timelines, and flexible deal structuring. Visit their profile to watch more short video clips, or watch the complete interview with Dave Orloff.
Funded DSCR Rental Loans
RCN Capital, a national direct private lender, funded a $350,000 DSCR long-term rental loan for a single-family home in Nashville, TN. The property value was appraised at $501,000 so our loan-to-value was 70%. We paid off a previous loan balance of $183,926. The Borrower acquired the property in February 2024 and rented it out for $3,000 per month, matching the appraiser’s market rent estimate. The debt service coverage ratio was 1.17. The property is approximately 1,784 square feet. The Borrower had good credit and solid liquidity, supporting the loan’s approval. The interest rate was fixed at 7.05% with amortized payments for a 30-year term. This DSCR refinance loan was funded in November 2024.
RCN Capital, a national direct private lender, funded a $360,000 1st lien position long-term rental loan for the acquisition of a single-family home in Saint George, UT. We funded 80% of the $450,000 purchase price, while the Borrower contributed 20% cash to the purchase at closing. The Borrower expects a monthly rent of approximately $2,600 which results in a 1.20 DSCR (debt service coverage ratio). They had good credit and sufficient liquidity. The subject property was in excellent condition and vacant at closing. It is approximately 1,354 square feet. The interest rate was 6% and we charged 4% origination points. The loan term was set at 30 years. This DSCR rental property loan was funded in October 2024.
I Fund Cities, an alternative lending platform, funded a $249,690 senior-lien position DSCR long-term rental loan for the acquisition of a single-family home in Houston, TX. We funded 78% of the $287,000 purchase price. IFC’s Houston, TX, Territory Manager Ross Wilkins connected with a new DSCR rental loan client at a local meetup. The Client, an investor active in the Houston metro area, typically purchases up to 30 properties per month depending on market conditions. They are constantly seeking direct lenders offering competitive DSCR rates and products. Having faced delays with previous lenders, the Client prioritized timely loan closure. We delivered favorable rates and terms and successfully closed this 30-year rental loan on schedule, enabling the Client to maintain rapid and efficient growth. This DSCR rental loan was funded in November 2024.
RCN Capital, a national direct private lender, funded a $237,250 1st lien position DSCR loan secured by a single-family home in McKees Rocks, PA. The purchase of the loan was to refinance and cash out equity. The property value was appraised at $365,000 so our loan-to-value was 65%. The Borrower had owned the property since August 2023 and completed a $70,000 rehab in August 2024, leaving the property vacant. The appraiser estimated the market rent at $3,400 per month which results in a 1.66 debt service coverage ratio. The Borrower is a foreign national. Their bank statements verified solid assets and liquidity, meeting the reserve requirement. The property is approximately 2,536 square feet and was in excellent condition. The interest rate was fixed at 7.4% with amortized payment. We charged 4% origination points. The loan term was set at 30 years. This DSCR loan was funded in September 2024.
RCN Capital, a national direct private lender, funded a $330,750 first-lien position DSCR loan secured by a single-family rental home in Columbus, OH. The property value was estimated at $441,000 (pending a Collateral Desktop Analysis), giving a loan-to-value ratio of 75%. The property was owned free-and-clear so the loan was equity cash out. The Borrower had excellent credit and sufficient liquidity to close. The property was in good condition and vacant at closing, but a tenant is expected to lease the property. The appraiser estimated the market rent at $3,100 per month. This results in a debt service coverage ratio of 1.16. The loan has a 3-year prepayment penalty. The subject property is approximately 1,236 square feet. The interest rate was 7.65% with amortized payments. The loan term was set at 30 years. This DSCR equity cash-out loan was funded in September 2024.
RCN Capital, a national direct private lender, funded a $236,250 1st lien position DSCR refinance loan secured by a single-family home in Chicago, IL. The property value was estimated at $315,000 so our loan-to-value was 75%. We paid off a previous loan balance of $191,951 and provided the rest as cash out to the Borrower. The property was purchased in July 2023 for $107,000 and was appraised at $315,000 as-is. A Collateral Desktop Analysis confirmed the value was acceptable. The 1,035 square foot home was leased, generating $2,600 per month, which matched the appraiser’s estimated market rent. The debt service coverage ratio was 1.21. The experienced Borrower had excellent credit and sufficient liquidity to close. The interest rate was fixed at 7.35% with amortized payments. The loan term was set at 30 years with a 3-year prepayment penalty. This DSCR equity cash-out refinance was funded in August 2024.
I Fund Cities, an alternative lending platform, funded a $245,600 DSCR rental refinance loan secured by a single-family home in McAllen, TX. The property value was estimated at $307,000 so our loan-to-value was 80%. The Borrower met our Texas director, Jack Pagliarini, through a cold call. Shortly after, Jack traveled down to McAllen to meet the Borrower in person and check out some of their ongoing projects. The Borrower has been flipping houses, building homes, and using the BRRRR method for the last five years and has consistently grown their portfolio in the Rio Grande Valley region, using friends, family, and bank money. The Borrower was in a hard money loan with deferred interest that was accruing by the day while they were searching for a lender who could maximize leverage for their newly renovated rental property, and close quickly. iFC provided a DSCR loan at 80% LTV to cover the previous loan payoff and keep them from bringing a significant amount of cash to the closing table. By coming to iFC for this deal, the Borrower gained a lender that offered fast service, flexibility, and the ability to provide higher leverage on their rental loan. The interest rate was fixed with amortized payment. This DSCR refinance loan was funded in May 2024.
RCN Capital, a national direct private lender, funded a $237,250 1st lien position DSCR loan secured by a single-family home in McKees Rocks, PA. The purchase of the loan was to refinance and cash out equity. The property value was appraised at $365,000 so our loan-to-value was 65%. The Borrower had owned the property since August 2023 and completed a $70,000 rehab in August 2024, leaving the property vacant. The appraiser estimated the market rent at $3,400 per month which results in a 1.66 debt service coverage ratio. The Borrower is a foreign national. Their bank statements verified solid assets and liquidity, meeting the reserve requirement. The property is approximately 2,536 square feet and was in excellent condition. The interest rate was fixed at 7.4% with amortized payment. We charged 4% origination points. The loan term was set at 30 years. This DSCR loan was funded in September 2024.
RCN Capital, a national direct private lender, funded a $280,000 1st lien position loan for the purchase of a 4-unit residential property in Lake Station, IN. We funded 80% of the $350,000 purchase price, while the Borrower contributed 20% cash at closing. The property was in good condition and tenant-occupied at closing. Three out of four units were leased, generating a total of $2,710 per month, presenting a 1.28 debt service coverage ratio. The Borrowers had sufficient liquidity and good credit to close. The loan was structured at 80% loan-to-value (LTV) and 80% loan-to-cost (LTC). The loan has a 3-year prepayment penalty. The interest rate was fixed at 6.97% with amortized payments. The loan term was set at 30 years. This DSCR rental purchase loan was funded in September 2024.
RCN Capital, a national direct private lender, funded a $236,250 1st lien position DSCR refinance loan secured by a single-family home in Chicago, IL. The property value was estimated at $315,000 so our loan-to-value was 75%. We paid off a previous loan balance of $191,951 and provided the rest as cash out to the Borrower. The property was purchased in July 2023 for $107,000 and was appraised at $315,000 as-is. A Collateral Desktop Analysis confirmed the value was acceptable. The 1,035 square foot home was leased, generating $2,600 per month, which matched the appraiser’s estimated market rent. The debt service coverage ratio was 1.21. The experienced Borrower had excellent credit and sufficient liquidity to close. The interest rate was fixed at 7.35% with amortized payments. The loan term was set at 30 years with a 3-year prepayment penalty. This DSCR equity cash-out refinance was funded in August 2024.
RCN Capital, a national direct private lender, funded a $262,923 1st lien position DSCR long-term rental purchase loan for a single-family home in Charlotte, NC. We funded 74% of the $350,000 purchase price, while the Borrower contributed 26% cash to the purchase at closing. This experienced Borrower plans to secure a long-term tenant after closing since they intend to hold the property long-term. The Borrower having excellent credit and financials helped them qualify for 74% loan-to-purchase price. The 1,491-square-foot subject property was in good condition and vacant at closing. It is expected to cash flow with a DSCR of 1.05. The interest rate was 6% with amortized payments, and we charged 4% origination points. The loan term was set at 30 years. This DSCR loan was funded in August 2024.
RCN Capital, a national direct private lender, funded a $400,000 1st lien position refinance loan secured by a 3-family residential property in Bridgeport, CT. The property value was appraised at $500,000 so our loan-to-value was 80%. We paid off a previous loan balance of $395,000. The subject property was acquired for $360,000 in September 2023 and underwent $20,000 in renovations to bring it to its current condition. It is now in good condition and all 3 units are leased, generating a monthly income of $5,200 which exceeds the market rent of $4,750 per month. This resulted in a 1.27 debt service coverage ratio. The building size is approximately 3,127 square feet. The Borrower had excellent credit. The loan term is 30 years with amortized payments and a 5-year prepayment penalty. The interest rate was fixed at 8.4% and we charged 1% origination points. This DSCR rental refinance loan was funded in May 2024.
RCN Capital, a national direct private lender, funded a $592,800 1st lien position long-term rental loan for the acquisition of 5 duplexes in Petersburg, VA. We financed 80% of the $741,000 purchase price, while the Borrower contributed 20% cash at closing. Based on the total as-is appraised value, the loan-to-value ratio was 74%. This is a 30-year blanket purchase loan. The Borrower, with excellent credit and sufficient assets, accepted a 3-year prepayment penalty. All 10 units were rented, and the debt service coverage ratio was 1.50. The interest rate was fixed at 7.965% with amortized payment and we charged a 1% origination point. Homeowners insurance was provided for all properties. The properties were in good condition and the total size is approximately 9,488 square feet. This DSCR rental purchase loan was funded in June 2024.
RCN Capital, a national direct private lender, funded a $185,250 1st lien position rental refinance loan secured by a single-family home in Columbus, OH. The property value was estimated at $247,000 so our loan-to-value was 75%. We paid off a previous loan balance of $190,000. The property was being leased for $1,685 per month, which aligned perfectly with the appraiser’s estimated market rent of $1,700. The “as-is” appraised value of the property was further confirmed by a commissioned appraisal (Collateral Desktop Analysis). This repeat Borrower is a foreign national who had excellent credit, while the bank statements showed good liquidity and met the reserve requirement. The loan structure boasts a strong debt service coverage ratio (DSCR) of 1.17. The subject property is approximately 1,053 square feet. It was in good condition and tenant-occupied at closing. The interest rate was fixed at 6.44% with amortized payments, and we charged 4% origination points. The loan term was set at 30 years. This DSCR loan was funded in April 2024.
RCN Capital, a national direct private lender, funded a $112,500 1st lien position equity cash-out loan secured by a 4-unit property in Duson, LA. The property value was appraised at $150,000 so our loan-to-value was 75%. We paid off a previous loan balance of $58,617 and the balance was made available for the Borrower to use for other investments. The property is a 4,000-square-foot fourplex which they have owned since early 2019. It was in good condition and all units were rented for a combined total of $2,250 per month which is above market rent per the appraiser’s estimate. The Borrower had excellent credit and sufficient assets. The interest rate was fixed at 8.29% with amortized payment. The DSCR was 1.83. The loan term was set at 30 years. This DSCR loan was funded in April 2024.
I Fund Cities, an alternative lending platform, funded a $245,600 DSCR rental refinance loan secured by a single-family home in McAllen, TX. The property value was estimated at $307,000 so our loan-to-value was 80%. The Borrower met our Texas director, Jack Pagliarini, through a cold call. Shortly after, Jack traveled down to McAllen to meet the Borrower in person and check out some of their ongoing projects. The Borrower has been flipping houses, building homes, and using the BRRRR method for the last five years and has consistently grown their portfolio in the Rio Grande Valley region, using friends, family, and bank money. The Borrower was in a hard money loan with deferred interest that was accruing by the day while they were searching for a lender who could maximize leverage for their newly renovated rental property, and close quickly. iFC provided a DSCR loan at 80% LTV to cover the previous loan payoff and keep them from bringing a significant amount of cash to the closing table. By coming to iFC for this deal, the Borrower gained a lender that offered fast service, flexibility, and the ability to provide higher leverage on their rental loan. The interest rate was fixed with amortized payment. This DSCR refinance loan was funded in May 2024.
RCN Capital, a national direct private lender, funded a $197,630 1st lien position long-term rental loan secured by a single-family home in Jacksonville, FL. The property value was appraised at $265,000 so our loan-to-value was 75%. We paid off a previous loan balance of $194,000. The property was purchased for $128,128 in November 2023, and the Borrower spent over $90,000 on renovations before placing tenants in it. The property was generating a monthly rent of $1,745 which is slightly above the appraiser’s estimated market rent. The DSCR (debt service coverage ratio) was 1.06. The Borrower had excellent credit and liquidity to close the deal. The interest rate was 7.40% with amortized payments, and we charged 2.75% origination points. The loan term was set at 30 years with a 5-year prepayment penalty. This DSCR rental refinance loan was funded in May 2024.
RCN Capital, a national direct private lender, funded a $136,000 1st lien position long-term rental loan for the acquisition of a 4-unit rental property in Ironwood, MI. We funded 74% of the $170,000 purchase price, while the Borrower contributed 26% cash at closing. The subject property was appraised for $183,000 as-is and was vacant when we funded the loan. A Collateral Desktop Analysis (CDA) was ordered and the value was confirmed with an appraisal. The appraiser estimated the market rent to be $3,450 per month. The property is approximately 3,475 square feet. The Borrower had excellent credit with a mid-score of 787 and bank statements that evidenced sufficient liquidity. The total loan amount was 80% loan-to-cost and 74.3% loan-to-value. The interest rate was 7.63% with amortized payment. and we charged 2.25% origination points. The loan term was set at 30 years. This DSCR rental purchase loan was funded in March 2024.
RCN Capital, a national direct private lender, funded a $519,750 1st lien position DSCR refinance loan secured by a portfolio of 4 single-family homes in Houston, TX. The total value of the 4 properties was estimated at $945,000 so our loan-to-value was 55%, and the debt-service coverage ratio was 1.15. We paid off a previous loan balance of only $8,942.
- PROPERTY 1 – 11816 Spring Grove Drive, Houston, TX 77099: SFR in good condition, appraised for $232,000, leased for $1,650 per month which is below market rent of $1,750/month.
- PROPERTY 2- 11806 Plumpoint Drive, Missouri City, TX 77099: SFR in good condition, appraised for $232,000, leased for $1,600 per month which is below market rent of $1,750/month.
- PROPERTY 3- 2026 Fall Meadow Drive, Missouri City, TX 77459: SFR in good condition, appraised for $233,000, leased for $1,700 per month which is below market rent of $1,850/month.
- PROPERTY 4- 4323 Stonehenge Trail, Houston, TX 77066: SFR in good condition, appraised for $248,000, leased for $1,800 per month which is above market rent of $1,750/month.
The Borrower had an average FICO score and excellent liquidity to close. The 4 properties totaled approximately 6,481 square feet. The interest rate was 6.96% with amortized payment and we charged 2.25% origination points. The loan term was set at 30 years. This DSCR equity cash-out loan was funded in March 2024.
RCN Capital, a national direct private lender, funded a $287,920 1st lien position long-term rental loan for the acquisition of a duplex in Bakersfield, CA. We funded 80% of the $359,900 purchase price, while the Borrower contributed 20% cash at closing. The Loan-to-Value (LTV) and Loan-to-Cost (LTC) ratios stand at 80%, indicating a substantial investment. The Debt Service Coverage Ratio (DSCR) was 1.13, suggesting the property’s ability to generate sufficient income to cover debt obligations. The interest rate was fixed at 7.27% with amortized payment, accompanied by 4% points charged by RCN. The Borrower had good credit and assets. The 2,091-square-foot property was in excellent condition. The loan term spans 30 years with a prepayment penalty for the initial 5 years. This DSCR rental purchase loan was funded in January 2024.