Louisville offers shotgun houses, Victorian doubles and brick ranches at prices that still produce solid rent. Investors with equity in Jefferson County rentals can use a DSCR cash-out refinance qualified on rent, not tax returns.
In short: Yes, LendingStreet finances DSCR cash-out refinances on 1-8 unit investment properties in Louisville, up to 75% LTV, qualified on the property's rent. The new payment, including taxes, insurance and any HOA dues, must be covered by rent at the program minimum, which is 1.0x on standard programs. No W-2s or tax returns are needed, LLC borrowers are standard and the minimum credit score is 620. In Louisville the items to settle early are Louisville Metro's rental registry and, for any short-term rental, the conditional use permit that non-host-occupied STRs need in residential zones.
You take a new loan for more than you owe, pay off the current mortgage and keep the difference. On a DSCR cash-out the new loan is sized off the appraised value, up to 75% LTV, compared with up to 80% on a purchase, and it can be a 30-year loan held in your LLC.
Qualification runs on the debt service coverage ratio: the rent divided by the new monthly payment, including principal, interest, taxes, insurance and any HOA dues. A bigger loan means a bigger payment, so the ratio after the cash-out is the one that has to clear the minimum, which is 1.0x on standard programs.
Germantown, Schnitzelburg, Shelby Park and Clifton are known for shotgun houses and camelbacks that rent well to young professionals. Old Louisville, one of the country's largest Victorian neighborhoods, has big houses split into apartments. The Highlands and Crescent Hill command higher rents, while Shively, the South End and the West End offer lower prices and higher gross yields.
Suburban rentals in St. Matthews, Jeffersontown, Okolona and Fern Creek attract family tenants. Across the Ohio River, Jeffersonville, Clarksville and New Albany in Southern Indiana are part of the same metro but follow Indiana rules, so treat them as a separate state for the loan.
Employers like UPS Worldport at the airport, Ford's Louisville Assembly and Kentucky Truck plants, and the hospital systems downtown keep rental demand broad. Shotgun houses are narrow, so appraisers compare them carefully with similar homes rather than with wider houses nearby.
Property in Louisville Metro is valued by the Jefferson County Property Valuation Administrator, which reassesses on a rolling basis and can raise values when sales in a neighborhood climb. Bills combine state, Metro, school and fire district rates, and rentals do not qualify for the homestead exemption.
Use your actual current bill, and check the PVA site for any new assessment notice. Old Louisville and other historic areas can see large swings when renovated sales set new comparables.
Kentucky's deed transfer tax applies to sales, so a refinance where you keep title generally avoids it. Closing costs are mainly title insurance, recording, appraisal and lender fees. Parts of Louisville near the Ohio River, including Butchertown and portions of the West End, sit in mapped flood zones behind the floodwall system, so check flood status and get a quote if required.
Louisville Metro requires owners of residential rental property to register with the rental registry. Registration is simple, but an unregistered rental or open code case can surface during underwriting, so handle it before applying.
For short-term rentals, Louisville requires registration, and a non-host-occupied STR in a residential zone generally needs a conditional use permit. If your cash-out depends on nightly income, make sure the permit and registration are in place, since revenue without them will not count.
This example is illustrative and not a quote. An investor owns a renovated shotgun house in Germantown leased at market rent. The property appraises at $240,000, the existing loan balance is $100,000, and taxes and insurance run about $330 a month against total rent of $1,750.
At 75% LTV the new loan is $180,000. Paying off $100,000 leaves about $80,000 before closing costs. Estimated principal and interest on a 30-year schedule is about $1,259, so the full payment is about $1,589 and the DSCR is about 1.10x, above the 1.0x standard minimum. If the PVA raised the assessment, adding $70 a month, the ratio would fall to about 1.06x, still above the minimum.
| Item | Amount |
|---|---|
| Appraised value | $240,000 |
| Maximum loan at 75% LTV | $180,000 |
| Existing loan payoff | $100,000 |
| Cash before closing costs | $80,000 |
| Estimated principal and interest | About $1,259 |
| Taxes and insurance | $330 |
| Total monthly payment | About $1,589 |
| DSCR at $1,750 rent | About 1.10x |
Old Louisville, Butchertown and other preservation districts have design review for exterior changes, and renovated historic homes often set new comparables. If you restored a Victorian or shotgun, a detailed list of improvements helps the appraiser support a higher value.
Investors who own several Louisville rentals sometimes use a blanket portfolio loan on five or more properties rather than separate refinances, keeping one closing and one payment.
Your cash is the smaller of two numbers: the 75% LTV limit and the largest loan the rent covers at 1.0x on standard programs. Duplexes, triplexes and fourplexes qualify on the combined rent of every unit, while 5-8 unit buildings can carry a lower max LTV that varies by program.
If you bought recently, seasoning rules vary by program, and some lenders base the loan on your cost plus documented rehab until enough time has passed. When the ratio is tight, a sub-1.0x program or a rate-and-term refinance is worth comparing. The Kentucky cash-out page covers the statewide picture.
Pull these together before you request a quote.
Yes. LendingStreet finances DSCR cash-out refinances on one- to eight-unit investment properties in Louisville, up to 75% LTV, starting at $150,000. Our investor loans are business-purpose loans on non-owner-occupied property.
Louisville Metro requires rental registration. Having it in place avoids questions during underwriting and title.
Possibly, if it is registered and, for a non-host-occupied STR in a residential zone, has a conditional use permit. Some programs qualify on projected short-term revenue.
It is the same metro but a different state. Properties in Jeffersonville, Clarksville or New Albany follow Indiana rules for taxes and closing.
No. The property's rent qualifies the loan. Expect a credit check with a 620 minimum, a review of reserves and entity documents if you own through an LLC.
It varies by program. Some programs allow cash-out quickly, while others size the loan on purchase price plus improvements until you have owned the property for a set time.
The loan can be sized down until it does, or a sub-1.0x program may fit. A rate-and-term refinance is another option.
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