Austin had one of the sharpest price run-ups in the country in 2021 and 2022, followed by one of the larger pullbacks. For a cash-out refinance, that means the date you bought matters more here than almost anywhere else in Texas.
In short: Yes. LendingStreet finances DSCR cash-out refinances on Austin-area rentals up to 75% LTV, qualifying on the property's rent with no W-2s or tax returns. Because Austin prices are high relative to rents and Travis County taxes are substantial, the 1.0x minimum ratio often caps the loan below 75%. Investors who bought before 2020 usually have the most room.
Austin values jumped sharply during 2021 and early 2022, then fell back as rates rose and a large wave of new homes and apartments came online. Many neighborhoods are still above their pre-2020 levels, but below the peak.
If you bought in 2018 or 2019, you likely still have strong equity. If you bought in 2022, the appraisal may come in under your purchase price, which limits or rules out cash-out for now. A rate-and-term refinance may be the better fit in that case.
Rents rose during the boom, but heavy apartment construction has kept them flat or softer in many parts of the metro. With high prices and moderate rents, Austin rentals often have thinner ratios than Houston or San Antonio.
That is not a dealbreaker, but it changes the math. Instead of asking how much the property is worth, ask how large a payment the rent supports at 1.0x. The answer often lands somewhere between 60% and 75% LTV.
Rentals in Austin pay city, county, school and other local taxes without the homestead exemption or homestead appraisal cap, so the Travis Central Appraisal District can move a rental's value to market each year. Suburbs in Williamson and Hays counties, including Round Rock, Pflugerville, Georgetown, Leander, Kyle and Buda, may add MUD or PID assessments.
Texas has no state mortgage recording or transfer tax, so the tax line is about the annual bill, not closing costs. Filing a protest when values drop can help your ratio directly.
This example is illustrative and not a quote. An investor owns a South Austin house appraised at $480,000, owing $170,000. It rents for $3,000 a month, with taxes around $820 a month and insurance around $190.
At the full 75% LTV, the loan would be $360,000 with a total payment of about $3,405, giving a DSCR of about 0.88x. At 60% LTV the loan is $288,000, the payment is about $2,926 and the DSCR is about 1.03x, which clears the 1.0x minimum and still returns $118,000 before closing costs.
| Item | At 75% LTV | At 60% LTV |
|---|---|---|
| Loan amount | $360,000 | $288,000 |
| Cash before closing costs | $190,000 | $118,000 |
| Principal and interest (30 years) | About $2,395 | About $1,916 |
| Taxes and insurance (monthly) | $1,010 | $1,010 |
| Total payment | About $3,405 | About $2,926 |
| DSCR at $3,000 rent | About 0.88x | About 1.03x |
Austin has a lot of older duplexes in central neighborhoods, and recent city land-use changes allow more units on many single-family lots. Investors who added a second unit or an ADU can count the additional rent if both units are legally permitted and leased.
Unpermitted units are a common problem on Austin appraisals. If the appraiser cannot confirm the unit is legal, its rent may not count. Have permits and certificates of occupancy ready.
Austin requires short-term rental licenses, and its rules on non-owner-occupied STRs have been contested in court for years. The city has continued to revise them. If your property operates as an STR, confirm it is properly licensed before refinancing on nightly income, or qualify it on a long-term rent estimate instead.
Lake Travis and Hill Country properties outside the city limits fall under different rules. Check with the county or the nearest city.
Investors who bought early often use a cash-out to diversify into lower-priced markets with better rent-to-value, like San Antonio or the outer suburbs. Others pay off a construction or bridge loan on a new duplex, fund renovations or pull capital to buy out a partner. Some use the proceeds to pay down other debt so the whole portfolio carries a lower combined payment.
If you need cash but the ratio is tight, compare a smaller cash-out with keeping the current loan and using a line of credit on another asset.
Because so many Austin purchases happened at or near the peak, seasoning questions come up often. Seasoning rules vary by program. Some let you take cash out soon after buying, often with the loan limited to the purchase price plus documented improvements. Others want several months of ownership before the new appraised value can be used.
If you bought with cash and want to recover it, delayed financing may let you refinance shortly after closing, based on what you paid. If you used a bridge or construction loan to add a unit, the refinance into a DSCR loan is usually planned from the start, and having the permits, final inspection and leases ready makes the transition faster.
These items keep an Austin cash-out moving.
Yes. LendingStreet finances DSCR cash-out refinances on non-owner-occupied rentals in Austin and its suburbs, up to 75% LTV, starting at $150,000.
It depends on the current appraisal. If the value is at or below your purchase price, there may be little or no cash available. A rate-and-term refinance may be the better option.
Austin prices are high relative to rents. The rent has to cover the full payment at 1.0x on standard programs, which often caps the loan amount before the LTV limit does.
If the ADU is legally permitted and leased, its rent generally counts. Unpermitted units often cannot be counted.
Some programs can qualify an STR on projected income, but Austin's licensing rules must be satisfied first. Many investors qualify on a long-term rent estimate instead.
Yes. A lower appraised value for tax purposes means a lower tax escrow, which raises the ratio.
Yes, some programs allow a DSCR below 1.0x, usually with lower leverage or stronger credit and reserves.
No. The loan is qualified on the property's rent, not your W-2s or tax returns. You will need a 620 or higher credit score, reserves and, if the property is in an LLC, the entity documents.
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