Greater Lansing's rental market leans on state government, Michigan State University and the region's auto and insurance employers. A DSCR cash-out refinance can pull equity from your Lansing-area rentals using the rent they earn.
In short: LendingStreet offers DSCR cash-out refinances on Lansing rentals with one to eight units, lending up to 75% of appraised value based on rent rather than personal income. The rent has to cover the full new payment at the program minimum, 1.0x on standard programs, with a 620 minimum credit score and LLC ownership allowed. In Lansing the items to settle early are a current city rental certificate and the non-homestead school millage that rentals pay.
A cash-out refinance replaces your existing mortgage with a larger one. The difference, less closing costs, comes to you at closing. LendingStreet sizes the new loan at up to 75% of the appraised value on a cash-out, and the loan can close in an LLC with a 30-year term available.
Underwriting does not use your W-2s or tax returns. It compares the property's rent with the full new payment, meaning principal, interest, taxes, insurance and association dues. That debt service coverage ratio has to meet the program minimum, 1.0x on standard programs, after the extra cash is added to the balance.
Lansing's Eastside, Old Town and the neighborhoods around the Capitol have older two-story houses and duplexes that rent to state workers and young professionals. The south and west sides offer lower-priced bungalows and ranches with steady family demand. Prices are moderate, so a single modest house can fall near the $150,000 loan floor.
East Lansing rentals near MSU are a separate market with student demand, by-the-bed leasing and stricter rules. Okemos, Holt, Delta Township, Grand Ledge and DeWitt offer newer suburban homes, and those tend to appraise most cleanly for a cash-out.
Greater Lansing's employment base is unusually steady for a mid-size metro: state government offices, MSU, Sparrow and McLaren hospitals, General Motors' assembly plants at Delta Township and Lansing Grand River, and insurers like Jackson and Auto-Owners. That mix keeps vacancy fairly predictable for well-kept rentals.
Michigan caps annual increases in taxable value at the lesser of inflation or 5%, but taxable value uncaps when a property is sold, so a recently purchased rental can carry a much higher bill than the prior owner paid. Rentals also do not get the principal residence exemption, so they pay the non-homestead school operating millage, which can add a large share to the bill.
Lansing straddles Ingham, Eaton and Clinton counties, and millage differs by city, township and school district. Use the actual summer and winter tax bills in your DSCR math.
Michigan's state and county real estate transfer taxes apply to deeds, not to a refinance where title stays with you, so closing costs are mainly title insurance, recording, appraisal and lender fees. Insurance is moderate, but older Lansing homes with original electrical, aging roofs or old boilers can be harder to insure, so get a current quote.
The City of Lansing requires rental properties to be registered and to pass inspection to hold a valid rental certificate of compliance. An expired certificate or open violation can stall a refinance, so renew it before you apply.
East Lansing runs its own rental licensing program with occupancy limits, and some neighborhoods restrict new rental licenses. Suburban townships have their own rules. If your rent assumes more tenants than the license allows, the lender will only credit the licensed configuration.
This example is illustrative and not a quote. An investor owns an up-and-down duplex on Lansing's Eastside, with units leased at $950 each. The property appraises at $200,000, the existing loan balance is $70,000, and taxes and insurance run about $420 a month against total rent of $1,900.
At 75% LTV the new loan is $150,000. Paying off $70,000 leaves about $80,000 before closing costs. Estimated principal and interest on a 30-year schedule is about $1,049, so the full payment is about $1,469 and the DSCR is about 1.29x, above the 1.0x standard minimum. If the school millage on the winter bill rose, adding $80 a month, the ratio would fall to about 1.23x, still above the minimum.
| Item | Amount |
|---|---|
| Appraised value | $200,000 |
| Maximum loan at 75% LTV | $150,000 |
| Existing loan payoff | $70,000 |
| Cash before closing costs | $80,000 |
| Estimated principal and interest | About $1,049 |
| Taxes and insurance | $420 |
| Total monthly payment | About $1,469 |
| DSCR at $1,900 rent | About 1.29x |
Values vary widely between Lansing's Eastside, the suburbs and East Lansing, so appraisers lean on close comparables. A renovated duplex near Old Town may appraise well above an older one a few blocks away. Give the appraiser a list of updates with dates, since that work can raise the value and the cash available.
Because prices are moderate, investors with five or more Lansing rentals sometimes combine them in a blanket portfolio loan rather than refinancing each house near the $150,000 floor.
Start with 75% of value, then check whether the rent covers that payment at the minimum ratio. If not, the loan steps down until it does. Multi-unit properties count the rent of all units, and 5-8 unit buildings may have a lower LTV cap, which varies by program.
Time since purchase matters as well. Cash-out seasoning varies by program: some lenders allow it within months, others size the loan on purchase price plus documented improvements. Programs below 1.0x and rate-and-term refinances are alternatives when the numbers are close. Our Michigan cash-out page explains the state-level rules.
Having these ready keeps the appraisal and underwriting moving.
Yes, on non-owner-occupied rentals with one to eight units, up to 75% LTV and from $150,000. Our investor loans are business-purpose loans on non-owner-occupied property.
The city requires rentals to be registered and inspected. A current certificate avoids delays, and lenders may ask for it if the appraiser flags the property as a rental.
Michigan's taxable value uncaps when a property sells, and rentals pay non-homestead school millage. Both can raise the bill compared with the prior owner.
Yes, if it holds a valid rental license. The rent that counts has to match the licensed occupancy for the property.
Not personal income. The property's rent qualifies the loan, along with a 620 or higher credit score and reserves.
Seasoning varies by program. Some programs allow a cash-out within months; others cap the loan at cost plus documented rehab for a period.
Often, yes, with a smaller loan or a program that accepts a ratio below 1.0x. Terms vary by program.
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