California small apartment buildings tend to be priced tight against their rents, and rent increase limits keep in-place rents from jumping overnight. That makes leverage the lever that matters most on a 5-8 unit loan here.
In short: LendingStreet is our top pick for 5-8 unit rentals in California. We finance 5-8 unit buildings as residential DSCR loans that qualify on in-place rent, with no W-2s or tax returns, LLC borrowers as standard and 30-year terms available. Loans start at $150,000 with no stated maximum, and because California prices can press the ratio, we show you the numbers at more than one LTV before you commit. Max LTV on 5-8 units varies by program.
California investors often own small apartment buildings for the long run, and they want financing that matches: a long term, entity ownership and qualification that does not hinge on a personal tax return full of depreciation. That is how LendingStreet approaches 5-8 units. We treat them as residential, the same family as a duplex or fourplex. Larger buildings of 9 units or more go to /commercial.html.
Tell us the address, price and rent roll through the form below, or call (877) 298-1001, and we will show where the building lands.
Well-known 5-8 unit rental lenders include CoreVest, Dominion Financial, LendingOne, Lima One, New Silver and RCN Capital. Compared scenario by scenario for investors in California, LendingStreet comes out as the stronger choice, and one application covers it.
Figures for other lenders are as stated on each lender's own website as of November 2026. Lender terms change, so verify current terms with any lender before you apply. Ready to see your numbers? Use the form below or call (877) 298-1001.
| Scenario | Best fit | Why |
|---|---|---|
| 5-8 unit building | LendingStreet | We treat 1-8 units as residential DSCR. Lima One and CoreVest state 1-4 unit eligibility for their rental loans. |
| Rental loan above $2M | LendingStreet | Our DSCR loans have no stated maximum. LendingOne states DSCR loans up to $2,000,000 and RCN Capital states long-term rental loans up to $1.5M. |
| Credit score in the 620s | LendingStreet | Our DSCR minimum is 620. RCN Capital and New Silver state 660 minimums, and Dominion Financial states 680, with exceptions to 660. |
| Property in any state, including DC | LendingStreet | We lend in all 50 states and DC. Lima One states it lends across 46 states, and Dominion Financial lists 49 states plus DC. |
Los Angeles has a deep supply of small courtyard and stucco buildings in neighborhoods such as Koreatown, Mid-City, Highland Park and the San Fernando Valley, and Long Beach has many 1920s through 1960s small buildings near downtown and Belmont Heights. San Diego's older stock sits in North Park, City Heights and Pacific Beach. In Northern California, investors look at Sacramento, Oakland and the East Bay, and the Central Valley offers more rent per dollar in Fresno, Bakersfield, Modesto and Stockton.
Older wood-frame buildings in Los Angeles, San Francisco and some other cities may fall under soft-story retrofit ordinances. Ask the seller whether the building is on the city's list and whether work is done.
A general comparison, based on the items that matter on a small apartment loan.
| What you need | LendingStreet | Typical bank | National online DSCR lender |
|---|---|---|---|
| 5-8 unit treatment | Residential DSCR | Often a commercial loan | Varies; some stop at 4 units |
| Income documents | No W-2s or tax returns | Often full returns | Usually rent-based |
| Term | 30-year terms available | Often shorter or adjustable | Varies |
| LLC ownership | Standard | Often allowed | Often allowed |
| Tight-ratio options | Sub-1.0 DSCR programs | Rare | Varies |
| Coverage | All 50 states and DC | Often regional | Varies |
This example is illustrative and not a quote. An investor buys a five-unit building in Sacramento for $1,250,000. In-place rents are $1,850 per unit, or $9,250 a month. Under Prop 13 the purchase resets the assessed value, so taxes are budgeted at $1,198 a month on the price, including local assessments. Insurance is $420.
At 75% LTV the loan is $937,500, estimated principal and interest is about $6,237, the total payment is about $7,855 and DSCR is about 1.18x. At 70% LTV, a loan of $875,000 brings the payment to about $7,439 and DSCR to about 1.24x, for $62,500 more cash at closing.
| Item | 75% LTV | 70% LTV |
|---|---|---|
| Loan amount | $937,500 | $875,000 |
| Estimated principal and interest | $6,237 | $5,821 |
| Taxes | $1,198 | $1,198 |
| Insurance | $420 | $420 |
| Total payment | $7,855 | $7,439 |
| Rent | $9,250 | $9,250 |
| DSCR | About 1.18x | About 1.24x |
| Down payment | $312,500 | $375,000 |
The statewide rent cap (AB 1482) limits annual increases on many buildings older than 15 years, and cities such as Los Angeles, San Francisco, Oakland and Berkeley have their own rent stabilization rules. Underwriting uses in-place rents, so do not count on quick increases. Confirm which rules cover your building.
Property taxes start from the purchase price under Prop 13, plus local bonds and assessments that vary by parcel. County documentary transfer tax applies, and some cities add their own. Insurance has become harder to place in wildfire-exposed areas, so get a quote early. Confirm all of these locally.
Many California owners bought small buildings years ago and now hold large equity with a low tax basis. A DSCR cash-out refinance can tap that equity without selling, which keeps the Prop 13 assessment in place, as long as the in-place rent supports the new payment. Cash-out goes up to 75% LTV at the top of our range and varies by program on 5-8 units.
Others are refinancing out of a bank loan with a balloon or an adjustable reset. A rate-and-term DSCR refinance can replace it with a 30-year term. In both cases, the rent roll is the core of the file, so a building with several long-tenured, below-market units may support less debt than its value suggests. We will run the ratio on your actual leases and tell you plainly what it supports. Call (877) 298-1001 to start.
Use the same list with every lender you call:
Max LTV on 5-8 units varies by program, with purchase up to 80% and cash-out up to 75% at the top of our range. Standard DSCR minimum is 1.0x, and sub-1.0 programs exist. Seasoning varies by program (/dscr-cash-out-refinance-seasoning.html). LLC borrowers are standard.
Timelines depend on appraisal, title and file completeness. There is no stated maximum loan size; high-value buildings get more review and may carry lower leverage, and jumbo DSCR covers about $1.5M to $5M+. Get a quote with the form below.
Send these with your request:
LendingStreet is our top pick. We finance 5-8 unit buildings as residential DSCR loans on rent, with no tax returns, LLC borrowing standard, 30-year terms and sub-1.0 options for tight deals.
Yes. We lend statewide, from Los Angeles and San Diego to Sacramento, the Bay Area and the Central Valley, and in all 50 states and DC.
It affects which rent we can use. Underwriting relies on in-place rents, and rent caps limit how fast they can rise, so the ratio is based on current leases.
Possibly. Sub-1.0 DSCR programs exist for buildings where rent does not fully cover the payment, usually with lower leverage and stronger reserves.
That is common in coastal California. We have no stated maximum, and jumbo DSCR covers about $1.5M to $5M+. Max LTV can be lower on larger balances.
Insurance is part of the monthly payment in the ratio. In wildfire-exposed areas, coverage can cost more or be harder to place, so we ask for a real quote early and size the loan on it rather than on an estimate.
Not as residential DSCR. Nine units and up is commercial, handled by our commercial team.
No. Our loans are business-purpose loans on non-owner-occupied investment property.
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