Does Grafton Funding offer DSCR loans for rental properties?

Yes — DSCR (Debt Service Coverage Ratio) loans are our most popular product. We lend on single-family rentals, 2–4 unit properties, short-term rentals (like Airbnb and VRBO), and small multifamily up to 10 units. We qualify the property on its rental income rather than your personal income or tax returns. Minimum DSCR is typically 1.0x, and we lend in TX, FL, GA, NC, SC, and other states.

Does Grafton Funding do fix and flip loans or bridge loans?

Yes. We provide fix and flip loans and bridge loans for non-owner occupied investment properties. Our programs cover the purchase price plus rehab costs, with fast closings. Loan terms are short-term (typically 12–18 months) and are designed around the investor's exit strategy — either sale or refinance.

Can I get a DSCR loan for an Airbnb or short-term rental property?

Yes — we specialize in short-term rental (STR) financing. We use either the property's actual Airbnb or VRBO income history or a market-rate STR income estimate to qualify the loan. You don't need W-2s or tax returns.

Does Grafton Funding offer new construction loans for investment properties?

Yes. We offer new construction loans for non-owner occupied residential investment properties, including spec builds, ground-up construction, and lot + build projects. These are short-term loans that fund in draws as construction progresses.

Does Grafton Funding lend in North Carolina?

Yes — we actively lend in North Carolina, including the Charlotte metro, the Triangle (Raleigh/Durham/Chapel Hill), Wilmington, and Asheville. We offer DSCR rental loans, fix and flip loans, and new construction financing for NC investment properties. Local NC line: (910) 218-1286.

Can I qualify for a loan without showing tax returns or personal income?

Yes — our DSCR loans are underwritten based on the property's rental income, not your personal income or tax returns. This makes them ideal for self-employed investors and business owners. We do require a credit check and down payment, but there's no traditional income verification.

What credit score do I need to get a loan from Grafton Funding?

For most DSCR rental loan programs, we generally look for a minimum credit score in the 660–680 range, though this can vary by program and loan-to-value. Fix and flip loans may have different requirements depending on experience and deal strength.

How much do I need to put down for a DSCR loan?

For DSCR rental loans, we typically lend up to 75–80% loan-to-value (LTV), meaning you'd need 20–25% as a down payment. The exact LTV depends on the property type, DSCR ratio, and your credit profile. We lend exclusively on non-owner occupied investment real estate.

How quickly can Grafton Funding close a loan?

Many of our transactions close in 2–4 weeks depending on the loan type, property, and how quickly documentation is provided. We prioritize responsive communication and efficient underwriting for investors who need to move fast on deals.

Does Grafton Funding work with first-time real estate investors?

Yes — we work with both new and experienced investors. For DSCR rental loans, first-time investors are welcome as long as the property cash flows and the borrower meets our credit and down payment requirements. For fix and flip loans, some experience is preferred but not always required.

How to Refinance an Investment Property with a DSCR Loan

3 days ago
5 min read

Refinancing a rental property used to mean going back through the same personal income documentation process that made it hard to get the loan in the first place.

DSCR refinances work differently.

Because DSCR loans qualify based on the property's rental income rather than your personal income, refinancing is available to self-employed investors, portfolio landlords, and anyone whose personal tax returns don't reflect their actual financial strength.

Quick Answer: DSCR refinances qualify on the property's rental income — not your W-2s or tax returns. Two types are available: cash-out refinances (pull equity from the property) and rate/term refinances (lower your rate or payment). Most programs require a 640+ credit score, a DSCR of 1.0 or higher, and allow up to 70–75% loan-to-value for cash-out.

Why Investors Use DSCR Loans to Refinance

No personal income documentation. Unlike conventional refinances, a DSCR refi doesn't require W-2s, tax returns, or employment verification.
Available to LLCs. Most conventional lenders won't refinance a property titled in an LLC. DSCR lenders are designed for entity borrowers.
No DTI limits. Conventional refinances count the new loan payment against your debt-to-income ratio. DSCR refinances don't.
Portfolio-friendly. You can have 5, 10, or 50+ DSCR refinances across your portfolio. There's no hard limit.
Ideal for high-income-write-off borrowers. Self-employed investors who write off significant business expenses often show low taxable income — making conventional refinances nearly impossible.

Two Types of DSCR Refinances

Cash-Out Refinance

A cash-out refinance pays off your existing loan and gives you additional cash based on your property's equity — up to 70–75% of the current appraised value.

When investors use cash-out DSCR refinances:

After completing a BRRRR to recover their renovation capital
To pull equity from an appreciated property and redeploy it into a new acquisition
To pay off a high-interest bridge or hard money loan with long-term financing

Cash-out DSCR refinance requirements:

Maximum LTV: 70–75% of appraised value
DSCR: typically 1.0 or higher based on the new loan amount
Credit score: 640+ (760+ for best rates)
Seasoning: most lenders require 3–6 months of ownership before a cash-out refi

Cash-out example:

Current appraised value: $300,000
Maximum LTV (75%): $225,000
Existing loan balance: $160,000
Available cash-out: $65,000
Net cash received (after ~2% closing costs): ~$60,500

Rate/Term Refinance

A rate/term refinance pays off your existing loan without taking additional cash out. The goal is a lower rate, a lower monthly payment, or a loan that better fits your current situation.

When investors use rate/term DSCR refinances:

When rates have dropped significantly since the original loan was taken
When moving a property from a bridge or hard money loan to a permanent DSCR loan
When refinancing from a conventional loan into a DSCR loan

Ready to Finance Your Rental Property?

Review DSCR refinance options — cash-out and rate/term — for investment properties nationwide.

View DSCR Loan Programs

DSCR Refinance Rates: What to Expect

DSCR refinance rates are typically 0.25%–0.5% higher than conventional investment property rates. Rates are influenced by credit score, loan-to-value, DSCR ratio, property type, and loan amount. Always get quotes from multiple lenders, as DSCR rates vary more between lenders than conventional rates.

The DSCR Refinance Process: Step by Step

Determine your goal: Cash-out, rate/term, or paying off a bridge loan.
Estimate your equity: Use recent comparable sales or an online AVM to estimate your current property value.
Verify your DSCR: Estimate the DSCR at the new loan amount. Divide rent by the new payment — if the result is 1.0+, you likely qualify.
Apply with a DSCR lender: Submit your application — basic personal information, property address, current lease agreement, and LLC documents if applicable.
Appraisal: The lender orders a full appraisal with rent schedule.
Underwriting and closing: DSCR refinances typically close in 2–4 weeks.

Seasoning Requirements: When Can You Refinance?

Rate/term refinance:

Most DSCR lenders have no seasoning requirement — you can refinance immediately after purchase, though it's uncommon.

Cash-out refinance after purchase:

Most lenders require 3–6 months of ownership (the seasoning period) before allowing a cash-out refi.

Bridge loan payoff:

If you're refinancing out of a bridge loan, most DSCR lenders do not impose a seasoning requirement — they understand that bridge loans are meant to be replaced by permanent financing. (BRRR)

Common Reasons Investors Refinance into DSCR Loans

Coming off a bridge or hard money loan.

Bridge loans are short-term by design. Once a property is stabilized and rented, replacing the bridge with a 30-year DSCR loan locks in permanent financing at a lower rate.

Pulling equity from an appreciated property.

If a property you've owned for several years has appreciated significantly, a cash-out DSCR refi lets you access that equity without selling.

Escaping a conventional loan.

Some investors start with conventional loans but eventually need to remove properties from their personal DTI. Refinancing into DSCR loans is the standard solution.

Bottom Line

DSCR cash-out refinances allow you to pull equity from appreciated or stabilized investment properties — up to 70–75% LTV
No W-2s, tax returns, or personal income verification required for DSCR refinances
Rate/term refinances are available to lower your rate or pay off a bridge loan
Most cash-out programs require 3–6 months of ownership; bridge loan payoffs typically have no seasoning requirement
DSCR refinances are available to LLC borrowers — making them the standard choice for portfolio investors

Frequently Asked Questions

Can I do a cash-out refinance on a rental property without showing income?

Yes. DSCR cash-out refinances qualify based on the property's rental income — not your personal W-2s or tax returns. If the property's rent covers the new loan payment at a DSCR of 1.0 or higher, the loan typically qualifies.

How much cash can I pull out in a DSCR cash-out refinance?

Most programs allow cash-out up to 70–75% LTV (loan-to-value). The available cash is the difference between the maximum LTV loan amount and your current loan balance, minus closing costs. Example: A $300,000 property at 75% LTV = $225,000 max loan. If your current balance is $160,000, you can receive approximately $60,000 in cash after closing costs.

How long do I have to own the property before doing a DSCR cash-out refinance?

Most lenders require a 3–6 month seasoning period before allowing a cash-out refinance. If you purchased with cash, many lenders apply the delayed financing exception — using the purchase price as the value for 3–6 months post-purchase. Refinancing out of a bridge loan typically has no seasoning requirement.

Can I refinance a property that's titled in my LLC?

Yes. DSCR refinances are specifically designed to accommodate LLC borrowers. You can refinance a property held in a single-member or multi-member LLC, and the new DSCR loan can be issued in the LLC's name. Personal guarantees are typically required from all members with 20%+ ownership.

What's the difference between a cash-out and rate/term DSCR refinance?

A cash-out refinance pays off your existing loan and provides additional cash based on your equity — the most common use case for BRRRR investors and equity harvesting. A rate/term refinance pays off your existing loan without providing additional cash — the goal is a lower rate, a better loan structure, or payoff of a bridge loan. Rate/term requirements are similar to cash-out but may allow slightly higher LTVs at some lenders.

Ready to Finance Your Rental Property?

Grafton Funding offers DSCR cash-out and rate/term refinances for investment properties nationwide. Whether you're pulling equity for the next deal, paying off a bridge loan, or restructuring your portfolio, we can walk you through the numbers.

Start Your Pre-Qualification