From Northern Virginia to Richmond to Hampton Roads, Virginia rentals have appreciated steadily. A DSCR cash-out refinance lets investors pull that equity out on the property's rent, with no W-2s or tax returns.
In short: Yes, LendingStreet finances DSCR cash-out refinances on 1 to 8 unit investment property in Virginia, up to 75% LTV, qualifying on the property's rent rather than your tax returns. The rent has to cover the new payment, including taxes and insurance, at the program minimum, which is 1.0x on standard programs, and the minimum credit score is 620. Virginia charges a recordation tax on deeds of trust, so a refinance carries a real closing cost that many investors do not expect.
A cash-out refinance replaces your current loan with a larger one. The new loan pays off the old mortgage, and the difference, less closing costs, goes to you. On a DSCR cash-out the new loan can go up to 75% of the appraised value, and it covers 1 to 8 unit rentals: single-family homes, condos, townhomes, duplexes, triplexes, fourplexes and small 5-8 unit buildings.
Approval rests on the debt service coverage ratio: monthly rent divided by the new monthly payment, including principal, interest, taxes, insurance and any HOA dues. A larger loan means a larger payment, so the ratio after cash-out is the one that has to clear the minimum, which is 1.0x on standard programs.
There are no W-2s or tax returns involved, LLC borrowers are standard and 30-year terms are available. The minimum credit score is 620, and you will need reserves after closing.
Northern Virginia, including Arlington, Alexandria, Fairfax and Prince William counties, has high prices and strong demand from government and contractor employment. Richmond has older rowhouses and single-family homes in the Fan, Church Hill and Northside, plus suburban rentals in Henrico and Chesterfield. Hampton Roads, including Virginia Beach, Norfolk, Chesapeake and Newport News, has large military-driven rental demand.
Roanoke, Lynchburg and Charlottesville round out the picture, with university and regional employment supporting rents at lower prices than Northern Virginia.
Virginia charges a state recordation tax on deeds of trust, and cities and counties can add a local portion. That means a cash-out refinance generally carries recordation tax on the new loan. Depending on how the refinance is structured, part of the existing balance may be eligible for an exemption, so ask your settlement agent how it applies.
Grantor tax on deeds generally does not apply to a straight refinance because ownership does not change. Title insurance, settlement fees, the appraisal and lender costs make up the rest.
Virginia property taxes are set by each city and county, and many localities reassess every year. In fast-appreciating areas, that means the tax bill can rise from one year to the next even with no change in rate. Northern Virginia bills tend to be the largest in dollar terms.
A refinance does not trigger reassessment. Underwriting uses the current bill, so budget on the latest assessment. Some localities also charge separate fees for stormwater or solid waste that appear on the bill and count in the payment.
Norfolk, Virginia Beach and other Hampton Roads communities face tidal and storm flooding, and many properties sit in mapped flood zones where flood insurance is required. Wind coverage near the coast can also be costly. Both premiums count in the DSCR payment.
Virginia's Residential Landlord and Tenant Act sets the rules for most rentals. Some localities require rental inspection programs in designated districts. Short-term rentals are regulated locally, including registration requirements in several jurisdictions, so confirm the rules before relying on nightly income.
This example is illustrative and not a quote. An investor owns a single-family rental in Richmond appraised at $420,000 with an existing loan of $180,000. Rent is $3,100 a month, and taxes and insurance run $560 a month.
At 75% LTV the new loan is $315,000, leaving $135,000 after the payoff and before closing costs. On a 30-year amortization, principal and interest is about $2,149, so the total payment is about $2,709 and the DSCR is about 1.14x, above the 1.0x standard minimum.
The recordation tax on the new deed of trust comes out of closing costs, reducing the net cash below $135,000. Ask your settlement agent for the figure.
| Item | Amount |
|---|---|
| Appraised value | $420,000 |
| New loan at 75% LTV | $315,000 |
| Existing loan payoff | $180,000 |
| Cash before closing costs | $135,000 |
| Monthly payment (P&I, taxes, insurance) | About $2,709 |
| DSCR at $3,100 rent | About 1.14x |
Seasoning rules vary by program. Some allow a cash-out within a few months of purchase; others measure the loan against your purchase price plus documented renovation costs until you have owned the property for a set period. If you bought with cash recently, delayed financing may be the cleaner route.
The loan amount is also limited by the 75% LTV cap, by the rent covering the new payment, and on 5-8 unit buildings and larger balances, by program-specific LTV limits that can be lower.
Our investor loans are business-purpose loans on non-owner-occupied property, and investors usually use the cash to grow or protect a portfolio:
Gathering these items before you apply keeps the appraisal and underwriting on schedule.
Yes. LendingStreet finances DSCR cash-out refinances on 1 to 8 unit investment property in Virginia, up to 75% LTV, with loans starting at $150,000 and no stated maximum.
The 75% LTV cap, the rent covering the new full payment at the program minimum, and closing costs. On 5-8 unit properties and larger balances, the maximum LTV can be lower.
Yes, generally. Virginia charges recordation tax on deeds of trust, with a possible exemption for part of the existing balance depending on structure. Ask your settlement agent.
Many localities reassess every year. A refinance does not trigger one, but underwriting uses the current bill.
Yes, if the numbers work. Flood insurance will be required and counts in the payment, which can reduce the loan amount.
Possibly. Seasoning varies by program, and recent renovation invoices can support the new value. Some programs cap the loan at cost basis until the property is seasoned.
No. The loan qualifies on the property's rent. You still need a 620 or higher credit score, reserves and entity documents if the property is held in an LLC.
No. Our investor loans are business-purpose loans on non-owner-occupied property, so the property must be a rental, not your residence.
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