Many Bangor landlords bought their multi-unit buildings years ago, when prices in the region were far lower. Those buildings have often doubled in value, and the equity can fund the next purchase or the boiler, roof and window work that older buildings eventually need.
In short: LendingStreet offers DSCR cash-out refinances on 1-8 unit rentals in Bangor and nearby towns up to 75% LTV, qualified on the property's rent instead of your personal income. Loans start at $150,000, the standard minimum DSCR is 1.0x, the minimum credit score is 620 and LLC borrowers are standard. Seasoning requirements vary by program.
Steady demand from the hospitals, universities and regional employers has pushed rents and values up across greater Bangor. A landlord who owns a three- or four-unit building on the East Side or in Brewer may have a small remaining loan and a lot of equity.
A cash-out refinance replaces the existing loan with a larger one and pays out the difference. Bangor investors use it to buy another building, to fund capital work like heating conversions and roofs, or to pay off a local bank loan with a balloon date.
Cash-out also lets owners fix problems that older buildings eventually force. A boiler at the end of its life, a roof that has seen too many ice dams or windows that leak heat all winter are easier to address with equity than with savings. Doing that work can also raise rents and support the next appraisal.
This example is illustrative and not a quote. An investor bought a fourplex on Bangor's East Side years ago. It now appraises at $400,000, with a remaining balance of $140,000. The four units lease for $1,175 each, or $4,700 a month. Taxes are about $680 a month and insurance about $260.
At 75% LTV the new loan is $300,000. Estimated principal and interest is about $2,047, the total payment about $2,987 and the DSCR about 1.57x. After paying off the old loan and about $7,000 in closing costs, the investor nets roughly $153,000.
| Item | Amount |
|---|---|
| Appraised value | $400,000 |
| New loan at 75% LTV | $300,000 |
| Existing balance paid off | $140,000 |
| Estimated closing costs | $7,000 |
| Estimated cash to investor | $153,000 |
| Total monthly payment | $2,987 |
| DSCR at $4,700 rent | 1.57x |
The DSCR uses principal, interest, taxes, insurance and any dues. In the example the tenants pay their own heat. If your building has one boiler and you pay the oil bill, the ratio is the same, but your real cash flow is much thinner in winter. Before taking out cash, make sure the property can carry the larger payment through a cold January as well as a mild July.
Many owners use cash-out proceeds to fix exactly this problem, converting to separate heating systems or heat pumps so tenants pay their own heat.
Before you refinance, run your own numbers on a full year, including fuel, snow removal, water and sewer if you pay them, and turnover costs. A ratio that clears comfortably on paper can still feel tight in February if the oil bill is large. Choosing a slightly lower loan amount can leave more room.
Common uses among Bangor-area investors include:
Appraisers look at condition, systems and comparable sales. In greater Bangor, multi-unit sales are less frequent than in larger cities, so comps may come from a wider area. Help the appraiser with a rent roll, leases and a list of improvements with dates and costs. A building with updated heat, a newer roof and clean common areas usually supports a stronger value.
Expect the appraiser to tour every unit, the basement and the heating system. Fix leaks, missing detectors and obvious safety issues beforehand, and have keys and tenant access arranged. A smooth inspection helps the report and the timeline.
A refinance does not trigger Maine's real estate transfer tax, which applies to sales. You will pay title, recording, appraisal and lender costs. Bangor's municipal tax rate has historically been higher than some surrounding towns, and a revaluation can change assessments, so use the current bill and ask the assessor's office about any planned revaluation.
Ask your insurer for a current quote as well, since a new loan may require updated coverage amounts.
If you bought or renovated recently, programs differ on when they will base the loan on the new appraised value instead of your purchase price plus documented improvements. See our seasoning guide for what to expect and what records to keep.
If you are refinancing a property you have owned for years, seasoning is usually not an issue. It mostly matters for investors who bought, renovated and want to pull cash out quickly.
If you only need to pay off a maturing loan and do not want cash, a rate-and-term refinance can allow higher leverage, up to 80% LTV on some programs. If you own five or more rentals, a blanket portfolio loan may refinance them together under one loan.
Some owners split the difference: a rate-and-term refinance on one building to clear a balloon, and a cash-out on another building with more equity. Looking at your properties together, rather than one at a time, often produces a better overall result, especially if you are planning to buy again in the next year or two and want the cash ready when the right building comes up.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the address, value, current balance, rents and who pays heat through the form below. For other Maine markets, see our Maine cash-out page.
Up to 75% of appraised value, minus the payoff and closing costs, as long as the rent covers the new payment at the program's DSCR.
No. Maine's transfer tax applies to sales, not refinances. Normal closing costs still apply.
Yes. Heat is not in the DSCR calculation, but plan for it in your own cash flow.
Seasoning varies by program. Some use the new value after a shorter hold; others limit the loan to cost plus improvements for a period.
No. The loan qualifies on rent. We review credit, with a 620 minimum, and reserves.
Yes, though maximum LTV can be lower on 5-8 units and varies by program.
Yes. That is one of the most common uses.
Yes. LLC borrowers are standard, and you sign for the loan personally.
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