In Missoula, a duplex is often the only way to make a rental pencil. Two rents on one lot can carry a price that a single-family rental cannot, especially near campus and on the Northside.
In short: LendingStreet finances Missoula duplexes, triplexes and fourplexes with DSCR loans that qualify on the combined rent of all units, with no W-2s or tax returns and LLC borrowers allowed. Loans start at $150,000, purchases go up to 80% LTV and the standard minimum DSCR is 1.0x. Because Missoula prices are high relative to rents, many 2-4 unit purchases here work at 65% to 75% LTV rather than the maximum.
Most of Missoula's small multifamily housing falls into three groups. Older homes converted into two or three units sit in the University District, the Slant Streets and the Lower Rattlesnake. Small duplexes and bungalow conversions are spread through the Northside and Westside. And newer side-by-side duplexes and fourplexes have gone up on the west side of town, including along the Mullan Road corridor, and in pockets of the Southgate and Miller Creek areas.
Students, university staff, health care workers at Providence St. Patrick and Community Medical Center, and young professionals keep vacancy low. Newer units with garages and in-unit laundry lease fastest.
Montana passed laws in 2023 aimed at allowing duplexes and accessory units in more residential zones in larger cities, including Missoula. Parts of that package were challenged in court, and the city has been updating its own code. Confirm current zoning for the parcel with the City of Missoula before you plan to add a unit or convert a house.
For an existing building, ask for proof that every unit is legal. Rent from an unpermitted basement or attic unit may not count when sizing the loan.
This example is illustrative and not a quote. An investor buys a Northside duplex for $560,000. Each unit rents for $1,650, so combined rent is $3,300 a month. Taxes are budgeted at $400 a month and insurance at $190.
At 70% LTV the loan is $392,000, estimated principal and interest is about $2,674, the total payment is about $3,264 and DSCR is about 1.01x, right at the minimum. At 65% LTV the loan is $364,000, estimated principal and interest is about $2,483, the payment is about $3,073 and DSCR rises to about 1.07x, which leaves some room for a vacancy or a tax increase.
| Item | 70% LTV | 65% LTV |
|---|---|---|
| Purchase price | $560,000 | $560,000 |
| Loan amount | $392,000 | $364,000 |
| Estimated principal and interest | $2,674 | $2,483 |
| Taxes and insurance | $590 | $590 |
| Total monthly payment | $3,264 | $3,073 |
| Combined monthly rent | $3,300 | $3,300 |
| DSCR | 1.01x | 1.07x |
Per unit, fourplexes in Missoula often sell for less than duplexes or single-family homes, so the ratio can work at higher leverage. For example, a west-side fourplex bought for $780,000 with four units at about $1,240 each ($4,950 a month) and a loan of $507,000 at 65% would carry estimated principal and interest of about $3,459. With $560 in taxes and $250 for insurance, the payment is about $4,269 and DSCR is about 1.16x. This is also illustrative and not a quote.
Check whether a fourplex sits on a single lot or was built as townhome-style units on separate parcels, since that affects how it is titled and financed.
Newer west-side fourplexes also tend to have lower maintenance and insurance costs than century-old conversions near campus, while the older buildings usually win on location and walkability. Both can work; the ratio and your reserves decide which one fits.
Near the University of Montana, many leases run August to May or on a 12-month cycle starting in late summer. If you buy in spring, units may turn over within months. Bring current leases and note end dates; the loan is generally sized on leases in place or market rent, depending on the program and situation.
Per-bedroom leasing is less common in Missoula than in larger college towns, but some converted houses are rented by the room. Ask how those leases will be read before you close.
Missoula County tax bills rose for many owners after recent statewide reappraisals, and Montana's newer rate structure favors primary residences over rentals. Budget on the rental figure, not the seller's bill. Montana does not charge a state real estate transfer tax.
Insurers look closely at wildfire exposure, roof age and older wiring in Missoula's early-1900s houses. Winter brings snow loads and freeze risks, so ask about pipe protection and heating systems.
Many of Missoula's older duplexes and converted houses come with deferred maintenance: original windows, aging boilers or furnaces, steep stairs to upper units and unfinished basements. If a building is not rent-ready, a DSCR loan at purchase may be hard to size, because the rent the loan relies on is not there yet.
In that case investors often buy with a bridge or fix-and-flip loan, finish the work, lease the units and then refinance into a DSCR loan. Cash-out seasoning rules vary by program, so plan the timing before you close on the purchase.
If you are looking at a 5-8 unit building near campus or downtown, see our page on 5-8 unit DSCR loans in Missoula; max LTV can be lower and varies by program. Investors who already own several Missoula rentals can combine five or more under a blanket portfolio loan.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the address, price and rents through the form below or call (877) 298-1001, and we will run the ratio at a few loan amounts.
Yes. The loan qualifies on the combined rent of both units, with no W-2s or tax returns and LLC borrowers allowed.
Prices are high relative to rents, so the ratio often clears 1.0x only at moderate leverage, commonly 65% to 75% LTV.
State and city rules have moved toward allowing more duplexes and accessory units, but parts were challenged in court. Confirm current zoning with the city.
Yes. Bring current leases and note when they end, especially if the school-year cycle is near.
Montana does not charge a state real estate transfer tax. Other closing costs still apply.
Yes. Cash-out goes up to 75% LTV, and the combined rent must still clear the program minimum.
$150,000. Most Missoula 2-4 unit purchases are well above that.
No. The loan qualifies on the property's rent, and LLC borrowers are standard.
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