In Washington, DC, most 2-4 unit rentals are rowhouses that were converted into two or three units, or small flats buildings in older neighborhoods. Prices are high relative to rents, and the District has more tenant rules than almost anywhere else.
In short: Yes. LendingStreet finances duplexes, triplexes and fourplexes across Washington, DC with DSCR loans that qualify on the combined rent of all units, with no W-2s or tax returns. Loans start at $150,000 with no stated maximum, purchases go up to 80% LTV and cash-out up to 75% LTV, and the standard minimum DSCR is 1.0x with a 620 minimum credit score. In DC, plan for high purchase prices relative to rent, the Tenant Opportunity to Purchase Act on occupied buildings, and a Basic Business License for each rental.
Rowhouse conversions are common in Petworth, Columbia Heights, Park View, Brookland, Bloomingdale, Eckington, Trinidad and Capitol Hill, typically with a basement unit and one or two units above. Shaw and Logan Circle have higher-priced conversions, while neighborhoods east of the Anacostia River, such as Congress Heights and Hillcrest, have lower prices and small flats buildings.
Many DC conversions were done in the last 15 years, so check that the work was permitted and that the certificate of occupancy reflects the number of units being rented.
| Area | Typical 2-4 unit stock | What to check |
|---|---|---|
| Petworth, Columbia Heights, Park View | Rowhouse conversions with 2-3 units | Permits and certificate of occupancy |
| Capitol Hill and Shaw | Higher-priced conversions | Historic district rules; tight ratios |
| Brookland and Trinidad | Rowhouses and small flats | TOPA if tenants are in place |
| East of the river | Lower-priced flats and rowhouses | Condition and rental license |
The debt service coverage ratio compares the building's gross monthly rent with its monthly housing payment. On a duplex, triplex or fourplex, that rent is the total from all units, and the payment includes principal, interest, taxes, insurance and HOA dues where they apply.
Leases on occupied units are compared with the appraiser's rent survey, and a vacant unit is usually counted at market rent. Because the loan qualifies on the property, there are no W-2s or tax returns, and borrowing in an LLC is standard.
Run the numbers with figures you can verify. For a Washington, DC purchase, that means taxes estimated for an investor owner, a written insurance quote covering every unit, and rents that match the leases or the local market, so the ratio holds up in underwriting.
DC taxes residential property at a uniform residential rate, and the homestead deduction applies only to owner-occupants, so an investor's bill will not include it. Reassessment is annual, with increases limited for owner-occupied homes but not for rentals in the same way.
Closing costs in the District are high. DC charges both a deed recordation tax and a transfer tax, each above 1% of price and higher on more expensive sales. They are often split between buyer and seller by contract. On a $1M+ building, those taxes are a five-figure line, so include them in your cash to close.
This example is illustrative and not a quote. An investor buys a rowhouse converted to two units in Petworth for $1,150,000. Rent is $3,200 and $2,400, or $5,600 a month across both units. The upper unit rents for $3,200 and the basement unit for $2,400.
In the 75% LTV column, the loan is $862,500, estimated principal and interest is about $5,738, taxes are $815 a month and insurance is $200, for a total payment of about $6,753 and a DSCR of about 0.83x. In the 60% LTV column, the loan is $690,000, estimated principal and interest is about $4,591, taxes are $815 a month and insurance is $200, for a total payment of about $5,606 and a DSCR of about 1.00x. Even at 60% LTV the ratio sits right around 1.0x. That is typical in DC, where many investors use sub-1.0 DSCR programs or put more down.
| Item | 75% LTV | 60% LTV |
|---|---|---|
| Purchase price | $1,150,000 | $1,150,000 |
| Combined monthly rent | $5,600 | $5,600 |
| Loan amount | $862,500 | $690,000 |
| Estimated principal and interest | $5,738 | $4,591 |
| Property taxes (monthly) | $815 | $815 |
| Insurance (monthly) | $200 | $200 |
| Total monthly payment | $6,753 | $5,606 |
| DSCR | About 0.83x | About 1.00x |
Brick rowhouses generally insure well, but flat roofs, older electrical panels, and shared party walls can come up in underwriting. Basement units can have water intrusion issues. A few low-lying areas near the Anacostia and Potomac are in flood zones. Get a quote that covers all units and confirm that liability limits fit a multi-unit rental.
DC's rent stabilization law covers many buildings built before 1976, with an exemption for small owners that has specific ownership conditions; ask counsel whether your entity qualifies. The Tenant Opportunity to Purchase Act gives tenants in 2-4 unit buildings rights when an owner sells, which adds time and notice steps to buying an occupied building.
Every rental unit needs a Basic Business License for rental housing, and conversions need the right certificate of occupancy. These items affect whether rent can be legally collected, so they matter to the loan.
Loan size, leverage and the 1.0x standard minimum DSCR do not change between a duplex and a fourplex. Loans start at $150,000 with no stated maximum, purchases go up to 80% LTV and cash-out refinances up to 75% LTV. More units simply mean more rent to cover the payment and less exposure to any single vacancy.
Small apartment buildings with five to eight units are financed under residential programs too, though leverage can be lower and review deeper, depending on the program. At nine units and up, the loan becomes commercial.
Gather these before you apply.
Share the property address, unit count, rents and the loan amount you want. LendingStreet will check the ratio at a few loan amounts using local tax and insurance figures and show you what fits, including sub-1.0 DSCR programs where they make sense. Our investor loans are business-purpose loans on non-owner-occupied property. Get a quote with the form below or call (877) 298-1001.
If tenants are in place, the seller must follow TOPA notice rules before selling, which can add time. Vacant buildings or single-family homes have different rules.
It depends on the building age and the owner. Many pre-1976 buildings are covered, and the small-owner exemption has conditions. Ask a DC attorney.
Yes. Each rental needs a Basic Business License for rental housing, and conversions need a matching certificate of occupancy.
Prices are high relative to rents, so at 75% to 80% LTV the payment often exceeds the rent. A lower loan amount or a sub-1.0 DSCR program can close the gap.
No. DSCR loans qualify on the building's rent, not your personal income. Expect a 620 minimum credit score, reserves and LLC documents if you use an entity.
Usually at market rent from the appraisal. Programs vary, so a signed lease on the vacant unit can help if the ratio is close.
No. Our investor loans are business-purpose loans on non-owner-occupied property, so the borrower cannot live in any unit.
Up to 75% of appraised value, minus the payoff and closing costs, if the rent still clears the program minimum at the new payment. Seasoning varies by program.
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