DSCR Rate & Term Refinance
A DSCR rate-and-term refinance replaces an existing investment property loan to change the interest rate, term, or structure without taking significant cash out. Eligible programs may qualify using the property’s rental income. Terms and eligibility vary by lender, property, and jurisdiction.
Key Takeaways
- Rate-and-term changes rate, term, or structure without significant cash-out.
- Eligible programs may qualify using property cash flow.
- Often used to move off short-term or bridge financing.
- Terms vary by program and scenario.
When Investors Use Rate-and-Term
A rate-and-term refinance is generally used to adjust the loan itself — for example, changing the rate or term — rather than to pull equity out. Investors sometimes use it to replace maturing short-term or bridge financing with a longer-term DSCR loan.
What Underwriting Reviews
Eligible programs evaluate the property’s qualifying rental income relative to the new monthly housing expense, along with credit, property value, and reserves. Requirements vary by program and investor.
Frequently Asked Questions
- Can I refinance from a bridge loan to a DSCR loan?
- Refinancing from short-term or bridge financing into longer-term DSCR financing may be possible on eligible properties, subject to cash flow, value, and program guidelines.
Have a specific property in mind?
Run your scenario or talk through the details with our team.
This article is for general educational purposes only and is not financial, legal, tax, or lending advice, a commitment to lend, or an offer to enter into a rate-lock agreement. All loans are business-purpose investor loans subject to underwriting, property review, investor guidelines, and applicable law. Program availability and terms vary by state and transaction. Simple DSCR is an assumed business name of WooHoo Mortgage LLC, NMLS #2347993.