Rowhouses with English basement units are the classic DC rental, and many owners in Petworth, Brookland and Columbia Heights have seen values climb. A DSCR cash-out can turn that equity into capital, qualified on the rent from both units.
In short: LendingStreet finances DSCR cash-out refinances on 1-8 unit rentals in Washington, DC and nearby suburbs, up to 75% LTV, qualifying on rent with no tax returns. Standard programs need the rent to cover the new payment at 1.0x. In DC, the local items are the Basic Business License for rentals, rent control and its small-landlord exemption, and whether a basement unit is legal and licensed.
You keep the property, pay off the existing lien and take the remaining loan proceeds as cash. Loan size is capped at up to 75% of appraised value on cash-out, loans start at $150,000 with no stated maximum, and LLC borrowers are standard.
Because a bigger balance means a bigger payment, the ratio that matters is the one after the refinance: rent divided by principal, interest, taxes, insurance and HOA dues. Most programs want at least 1.0x, with a 620 minimum credit score and no personal income documents. In DC, the rent from a legal, licensed basement unit is often what makes the ratio work.
Petworth, Brightwood, Columbia Heights, Bloomingdale and Eckington are full of rowhouses, many with English basement units. Brookland near Catholic University and Trinidad near H Street have seen steady renovation. Capitol Hill is higher-priced. East of the Anacostia River, Congress Heights, Anacostia and Deanwood offer lower prices.
In the suburbs, Prince George's and Montgomery counties in Maryland and Arlington, Alexandria and Fairfax in Virginia each have their own taxes and rules, and our DSCR programs work across them.
Many DC rowhouses were converted to two-unit condos or flats during the last two decades. If your building was split into condos, each unit may need its own loan; if it is a two-unit flat, a single DSCR loan can cover both. Know which structure you own before you apply.
| Area type | Examples | Typical rental | Cash-out watch item |
|---|---|---|---|
| Northwest rowhouse areas | Petworth, Columbia Heights, Bloomingdale | Rowhouses with basement units | Legal unit and BBL |
| Northeast | Brookland, Trinidad, Eckington | Rowhouses, small multi-units | Condo conversion history |
| East of the river | Congress Heights, Anacostia, Deanwood | Single-family, small multi-units | Appraisal support |
DC requires a Basic Business License to rent residential property, along with a certificate of occupancy for some unit types. Keep the license current; an unlicensed rental can limit your ability to collect rent and can complicate a refinance.
DC's rent control law covers many older rental units, but there are exemptions, including buildings owned by a natural person with no more than four rental units in the District, which must be claimed by filing. Underwriting uses lease rent the property can legally collect, so know whether your units are covered.
Rental housing in DC also needs to be registered with the rent administrator, either as a covered unit or with an exemption claim. Keeping that filing consistent with your leases and license avoids questions in underwriting.
This example is illustrative and not a quote. An investor owns a Petworth rowhouse with a legal, licensed English basement unit, appraised at $850,000 with $380,000 owed. The main house leases for $3,600 and the basement for $1,900. Taxes are about $600 a month and insurance about $140.
At 75% LTV the new loan is $637,500. After paying off the $380,000 balance, about $257,500 is left before closing costs. Estimated principal and interest on a 30-year schedule is about $4,457, so with taxes of $600 and insurance of $140 the monthly payment is about $5,197 and DSCR is about 1.06x.
At 70% LTV the loan is $595,000, the payment about $4,900 and DSCR about 1.12x, freeing $215,000.
Without the basement rent, neither loan would cover the payment. The certificate of occupancy and license for that unit carry real weight in DC.
| Item | 75% LTV | 70% LTV |
|---|---|---|
| Appraised value | $850,000 | $850,000 |
| Loan amount | $637,500 | $595,000 |
| Existing payoff | $380,000 | $380,000 |
| Cash before closing costs | $257,500 | $215,000 |
| Estimated principal and interest | $4,457 | $4,160 |
| Taxes and insurance | $740 | $740 |
| Total monthly payment | $5,197 | $4,900 |
| DSCR at $5,500 rent | About 1.06x | About 1.12x |
DC taxes occupied residential property at its residential rate, but vacant and blighted properties are taxed at much higher rates. A rental between tenants usually is not classified as vacant, but long vacancies can draw scrutiny.
DC charges recordation tax on many deeds of trust, and on a refinance the amount depends on structure. Ask title for an estimate. The Tenant Opportunity to Purchase Act applies to sales, not refinances.
DC limits short-term rentals to the host's primary residence, so a non-owner-occupied rowhouse cannot qualify on nightly income in the District. Most DC cash-outs are underwritten on 12-month leases.
Many rowhouses are over a century old. Insurers ask about roofs, electrical and plumbing, and DC has strict lead-safe rules for pre-1978 rentals.
Maryland and Virginia suburbs follow their own rules. Montgomery County has rent stabilization and rental licensing, and Prince George's County requires rental licenses, so check the county where a suburban property sits.
A complete package gets a cleaner answer the first time.
Our investor loans are business-purpose loans on non-owner-occupied property. We finance DSCR cash-out refinances on 1-8 unit rentals across the District and nearby Prince George's and Montgomery counties in Maryland and Arlington, Alexandria and Fairfax in Virginia, and the same team handles purchases and rate-and-term refinances when your next move is a new property.
Send the address, your estimated value, the payoff and current rents through the form below, or call (877) 298-1001. We run the ratio at a few loan amounts, flag the local items above and come back with options, including seasoning-friendly and sub-1.0 programs where they fit.
Yes. DC requires a Basic Business License for residential rentals.
Many older units are, but there are exemptions, including for natural persons owning four or fewer units, which must be claimed by filing.
Yes, when the unit is legal and licensed with a certificate of occupancy.
No. DC limits short-term rentals to the host's primary residence.
It depends on the program. Some will lend on the new appraised value soon after closing; others limit the loan to cost plus documented rehab until you have owned the property longer.
No. A DSCR loan looks at the property's rent against the new payment, plus credit of 620 or higher and reserves. No W-2s or tax returns are needed.
Yes. LLC borrowers are standard on our DSCR programs, and the members typically sign for the loan personally.
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