Walk the blocks between campus and downtown and you will see them everywhere: two-story walk-ups from the 1960s and 1970s with six, seven or eight units, exterior stairs and a gravel lot out back. They are Eugene's most common small apartment building, and they qualify for residential DSCR financing.
In short: LendingStreet finances 5 to 8 unit residential buildings in Eugene and Springfield with DSCR loans that qualify on the combined rent of all units. Loans start at $150,000 with no stated maximum, the standard minimum DSCR is 1.0x, the minimum credit score is 620 and LLC borrowers are standard. Maximum LTV on 5-8 unit properties can be lower than on single-family homes and varies by program.
West University and the blocks east of campus hold the densest collection of 5-8 unit buildings, many leased to students. The Fairmount and Amazon areas, the Jefferson Westside and the corridors along Willamette Street, Coburg Road and River Road add buildings with more non-student tenants. In Springfield, small buildings near Main Street and the hospital corridors rent to healthcare and service workers.
Unit mixes vary. Near campus you will find studios, one-bedrooms and some larger units leased by the bedroom. Away from campus, two-bedroom units dominate.
The appraiser values the building and builds a rent schedule unit by unit. The loan is sized so the combined rent covers principal and interest, taxes, insurance and any HOA at the program minimum. Programs differ on how they count vacant units and below-market leases, so the rent roll is the core document.
This example is illustrative and not a quote. An investor buys a seven-unit building east of campus for $1,265,000. Each unit rents for about $1,240, $8,680 a month in total. Taxes are about $1,050 a month and insurance $520.
At 75% LTV the payment is about $7,882 and DSCR is about 1.10x. At 70% the ratio improves to about 1.16x, and at 65% LTV, a loan of $822,250, it reaches about 1.23x. Because maximum leverage on 5-8 unit buildings varies by program, running all three tells you how much cash the deal really needs.
| Item | 75% LTV | 70% LTV | 65% LTV |
|---|---|---|---|
| Loan amount | $948,750 | $885,500 | $822,250 |
| Estimated principal and interest | $6,312 | $5,891 | $5,470 |
| Taxes and insurance | $1,570 | $1,570 | $1,570 |
| Total monthly payment | $7,882 | $7,461 | $7,040 |
| DSCR at $8,680 rent | About 1.10x | About 1.16x | About 1.23x |
Most of Eugene's small buildings are well over 15 years old, which puts them under Oregon's statewide cap on annual rent increases. After the first year of a tenancy, most terminations must be for cause or a qualifying landlord reason. You can set a new rent when a unit turns over, but you cannot reset rents on tenants who stay.
Underwrite on the rent roll you are buying. If several units are well below market, the upside comes from natural turnover over time, not from a quick increase after closing.
Notice rules matter too. Oregon requires advance written notice before a rent increase and limits how often rent can rise in a year. If you buy a building mid-lease, review the seller's notices and increase history so you know when each unit can next be adjusted. Some long-term tenants may be eligible for relocation assistance if a tenancy is ended for certain landlord reasons, which is another reason to plan around the tenants in place.
Buildings from this era often have older electrical service, aluminum branch wiring in some units, original single-pane windows, flat or low-slope roofs and exterior stairs and walkways that need structural attention. Insurers ask about all of these, and the answers affect both the premium and the lender's review.
Seismic risk is part of owning in western Oregon. Earthquake insurance is a separate policy, and some investors budget for basic retrofits on older wood-frame buildings.
The DSCR formula uses rent against principal and interest, taxes, insurance and HOA dues. It leaves out costs that are very real on a small Eugene building: owner-paid water, sewer and garbage, common-area electricity, landscaping, turnover cleaning and repairs, and property management. On older buildings near campus, where units turn every summer, those costs can be meaningful.
Lenders will qualify the loan on the core payment, but your cash flow depends on the full picture. Ask the seller for twelve months of utility bills and a list of recent repairs, and get a management quote before you commit. A building that clears 1.1x on paper but carries heavy owner-paid utilities may leave less margin than a 1.05x building where tenants pay their own.
City of Eugene stormwater and wastewater charges, and any rental housing program fees, also belong in your operating budget. Check current rates with the city.
Buildings near campus often turn most of their units each summer. A rent roll pulled in July can show more vacancy than the building normally carries. Time a purchase or refinance so the rent roll reflects a typical month, or be ready to show the prior year's history and signed leases for fall.
The line between residential and commercial is the unit count.
| Property | Loan type | Leverage |
|---|---|---|
| Duplex to fourplex | DSCR, combined rent | Up to 80% LTV on purchases |
| 5 to 8 units | DSCR, combined rent | Can be lower, varies by program |
| 9+ units | Commercial multifamily | Commercial terms |
Send the address, price, rent roll, leases and any operating history through the form below, or call (877) 298-1001. Buildings with 9 or more units are covered on our multifamily loans page, and larger balances on our Eugene jumbo DSCR page. For statewide terms, see our Oregon 5-8 unit page.
Yes. Buildings with 1 to 8 units qualify for residential DSCR loans. Nine or more units are commercial.
Maximum LTV can be lower than on smaller properties and varies by program. In Eugene, the rent often supports 65% to 70% LTV.
For most buildings older than 15 years, yes. Increases on existing tenants are capped each year.
Yes. They are reviewed against market rent for each unit in the appraisal.
No. The loan qualifies on the building's combined rent.
Yes. Rate-and-term and cash-out are available, with cash-out leverage that can be lower and varies by program.
No, but vacancy affects the rent used. Vacant units are often counted at market rent, depending on the program.
Yes. LLC borrowers are standard.
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