Phoenix investors have an advantage many other Sun Belt markets do not: relatively low property taxes. That keeps more of the rent available for the loan payment, which often makes it easier to reach the full cash-out amount once the appraisal comes in.
In short: Yes. LendingStreet finances DSCR cash-out refinances on rentals across metro Phoenix up to 75% LTV, qualifying on the property's rent instead of your personal income. The rent must cover the new payment, including taxes, insurance and HOA dues, at the 1.0x standard minimum. Loans start at $150,000, LLC borrowers are standard and the minimum credit score is 620.
Metro Phoenix was one of the fastest-appreciating markets in the country in 2021 and early 2022. Prices then cooled, and a large pipeline of new single-family homes and build-to-rent communities in the West Valley and far East Valley has kept a lid on rent growth.
Most investors who bought before 2021 still have solid equity. If you bought in 2022, check recent sales closely, since some outer suburbs saw values soften. The appraiser will lean on sales in your subdivision, so a few nearby closings are the best preview.
Arizona property taxes on residential rentals are generally lower than in Texas or many Midwest states, and Arizona has no state mortgage recording tax. That combination leaves more rent available for principal and interest.
Where Phoenix files get tight is the HOA. A large share of homes in Gilbert, Chandler, Queen Creek, Surprise, Goodyear, Buckeye and north Phoenix are in associations, and the monthly dues count in the payment. Some associations also have leasing rules, minimum lease terms or rental registration requirements. Read the CC&Rs before you apply.
Starting in 2025, Arizona law ended city transaction privilege taxes on long-term residential rent, so most long-term landlords no longer pay that tax. Short-term rentals are treated differently and still owe transaction privilege and lodging taxes.
Arizona limits how far cities can restrict short-term rentals, but cities including Phoenix, Scottsdale and Tempe now require STR licenses or permits. If you want to qualify on nightly income, have the license and tax registration in place. Confirm current rules with the city and the Arizona Department of Revenue.
Phoenix does not face hurricanes or major hail on the scale of Texas, so insurance is often more moderate. Carriers still look at roof age, pools, plumbing and the electrical panel. Older homes in central Phoenix with original systems may draw higher quotes.
Summer heat also makes HVAC condition a real issue. If the unit is near the end of its life, that is a common use of cash-out proceeds.
This example is illustrative and not a quote. An investor owns a four-bedroom house in Mesa appraised at $420,000, owing $190,000. It rents for $2,650 a month. Taxes are about $190 a month, insurance about $140 and the HOA $85.
At 75% LTV the new loan is $315,000, leaving $125,000 after the payoff and before closing costs. On 30-year amortization, principal and interest is about $2,149. With taxes, insurance and HOA, the payment is about $2,564, for a DSCR of about 1.03x. Note how small the tax line is compared with a similar house in Texas.
| Item | Amount |
|---|---|
| Appraised value | $420,000 |
| Loan at 75% LTV | $315,000 |
| Existing loan payoff | $190,000 |
| Cash before closing costs | $125,000 |
| Principal and interest (30 years) | About $2,149 |
| Taxes, insurance and any HOA (monthly) | $415 |
| Total monthly payment | About $2,564 |
| Monthly rent | $2,650 |
| DSCR | About 1.03x |
Central Phoenix, including Maryvale, Sunnyslope, the Coronado area and south Phoenix, has older block ranch homes that rent well relative to price. Glendale, Peoria, Mesa and Tempe have a large stock of 1970s to 1990s homes and some small multifamily. The far West Valley and southeast Valley are dominated by newer subdivisions.
Duplexes, triplexes and fourplexes near Arizona State University in Tempe and in older parts of Phoenix and Mesa can be financed on residential DSCR programs, and 5 to 8 unit buildings can qualify at a lower maximum LTV that varies by program.
Phoenix investors often use cash-out proceeds in the following ways.
Phoenix has a large community of investors who buy older homes, renovate them and refinance into long-term debt. How soon you can take cash out depends on the program. Some programs allow a cash-out shortly after purchase but limit the loan to what you paid plus documented improvements. Others want several months of ownership before using the new appraised value.
If you plan to refinance out of a fix-and-flip or bridge loan, keep receipts, permits and before-and-after photos. Appraisers in the Valley see a lot of flipped homes, and clear documentation of the work helps support the value. Also make sure a lease is signed before the appraisal if possible, since a vacant property relies on the appraiser's rent estimate.
These items cover most Phoenix files.
Yes. We finance DSCR cash-out refinances on non-owner-occupied rentals across metro Phoenix, up to 75% LTV, starting at $150,000.
Property taxes are generally low, so more of the rent goes toward principal and interest. HOA dues can offset that in some subdivisions.
Arizona ended city transaction privilege taxes on long-term residential rent starting in 2025. Short-term rentals still owe applicable taxes. Confirm your situation with a tax advisor.
Some programs can qualify an STR on projected income, but the property should have its city license and tax registration in place.
They can. Underwriting may review lease restrictions, and the dues count in the payment.
Up to 75% of the appraised value, minus the payoff and closing costs, if the rent covers the new payment at the program minimum.
Yes. Two to four unit properties qualify on combined rent, and 5 to 8 unit buildings can qualify on residential programs at a lower maximum LTV. All leases, or a market rent estimate for each unit, are needed.
Seasoning varies by program. Some allow it soon after purchase; others require several months of ownership or limit the loan to cost plus improvements.
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