Grand Rapids has a deep stock of large 1890s to 1920s houses converted into five to eight units, especially in Heritage Hill, Eastown and East Hills. The city's rental certification program and Michigan's uncapping rule both shape the numbers.
In short: Yes, LendingStreet finances 5 to 8 unit rental buildings in Grand Rapids with DSCR loans that qualify on the combined rent of all units, with no W-2s or tax returns and LLC borrowers allowed. Loans start at $150,000 with no stated maximum, the standard minimum DSCR is 1.0x and maximum LTV on 5-8 units varies by program. In Grand Rapids, the city's rental certification, Michigan's uncapping of taxable value after a sale and building age are the items to plan for.
Heritage Hill, one of the largest urban historic districts in the country, has big Victorian and early 1900s houses divided into apartments, close to the Medical Mile and downtown. Eastown, East Hills, Midtown and Belknap Lookout have more conversions and some small brick walk-ups.
The West Side near John Ball Park and Grand Valley State's downtown campus has older conversions that lease to students and young professionals. Creston adds smaller buildings, while Wyoming, Kentwood and Grandville have 1960s to 1980s small buildings and newer complexes.
Converted houses in these neighborhoods often have third-floor units, shared entries and limited parking, so check egress, fire separation and how many units the city has certified.
| Area | Typical building | What to check |
|---|---|---|
| Heritage Hill | Large converted houses | Historic review, heating, egress |
| Eastown, East Hills, Midtown | Conversions and walk-ups | Parking, renovation quality |
| Wyoming, Kentwood, Grandville | 1960s-80s and newer buildings | Updated systems, separate city rules |
Our residential programs cover one to eight units, so a six or eight unit building in Grand Rapids is underwritten much like a fourplex, only with more rent and more units to document. Properties with nine or more units are commercial and are handled separately on our commercial programs.
Qualification runs on the property's rent, not your income: no W-2s, no tax returns, LLC ownership allowed. Loans start at $150,000 with no stated maximum, the minimum credit score is 620 and standard programs look for a DSCR of at least 1.0x. Purchases can go up to 80% LTV on some programs and cash-out up to 75%, but 5-8 unit buildings often get lower maximums; it varies by program.
Buildings that need major work before they can be leased are often financed first with a bridge or rehab loan, then refinanced into a DSCR loan once the units are rented. Seasoning for that refinance varies by program, so plan the timing before you buy.
Michigan assesses property at a 50% assessment ratio and caps annual increases in taxable value while one owner holds the property. In the year after a sale, taxable value uncaps and resets to the assessed value, so the seller's bill can understate yours. Rentals do not qualify for the principal residence exemption, so non-homestead school millage applies.
Michigan's state and county transfer taxes are customarily paid by the seller. Title, recording and lender costs still apply.
Grand Rapids requires rental properties to be certified, with periodic inspections. Ask the seller for the current certificate and the last inspection report, and confirm the legal unit count matches the certification.
Heritage Hill and other historic districts need approval from the Historic Preservation Commission for exterior changes, so plan renovation timing around reviews.
This example is illustrative and not a quote. Picture a 6-unit converted house in Eastown priced at $720,000. With units averaging $1,200, the building brings in $7,200 a month. The budget uses $1,600 a month for taxes and $380 for insurance.
At 75% LTV the loan is $540,000, estimated principal and interest is about $3,776 and the total payment is about $5,756, for a DSCR of about 1.25x. At 70% LTV the loan drops to $504,000, the total payment to about $5,504 and the DSCR rises to about 1.31x. The tax figure reflects uncapped taxable value and non-homestead millage, which is what a buyer will actually pay.
| Item | 75% LTV | 70% LTV |
|---|---|---|
| Loan amount | $540,000 | $504,000 |
| Gross monthly rent | $7,200 | $7,200 |
| Estimated principal and interest | $3,776 | $3,524 |
| Property taxes | $1,600 | $1,600 |
| Insurance | $380 | $380 |
| Total monthly payment | $5,756 | $5,504 |
| DSCR | About 1.25x | About 1.31x |
On a five to eight unit building, the appraiser usually looks at comparable small-building sales and at the income the units produce. The rent used for the ratio comes from current leases and a market rent estimate for each unit, and the lower of the two figures is often what counts.
That makes a clean rent roll worth the effort. List every unit, its rent, its lease dates and any concessions, and be ready to explain units that are vacant or leased below market.
West Michigan gets heavy lake-effect snow, which is hard on roofs, gutters and heating systems. Big converted houses often have older boilers or several furnaces, and insurers ask about their age.
Some properties near the Grand River are in mapped flood zones; check the FEMA map.
Corewell Health and the Medical Mile, Grand Valley State University, Michigan State's medical school campus, Meijer, Steelcase and other manufacturers support steady rental demand.
Prices are moderate compared with larger metros, and many five to eight unit buildings trade between $500,000 and $1,000,000. The uncapped tax bill is the line that most often surprises buyers.
Before you apply, pull together the paperwork that shows the building's income and costs. Then send it through the form below or call (877) 298-1001.
Our investor loans are business-purpose loans on non-owner-occupied property, and LendingStreet reviews each building on its own rent and costs. Share the rent roll, taxes and insurance quote, and the team will show you how the ratio changes at different loan amounts.
Yes. Grand Rapids requires rental certification with periodic inspections. Check the building's current status before closing.
In the year after a sale, taxable value resets to the assessed value, so your tax bill can be higher than the seller's.
Yes. Exterior changes need approval from the Historic Preservation Commission.
Yes, if the building has 5 to 8 legal units and the rent supports the payment.
No. The loan qualifies on the building's rent. You do not provide W-2s or tax returns.
Yes. LLC borrowers are standard on our DSCR programs, and you sign for the loan personally.
Yes. Cash-out goes up to 75% LTV on some programs, often lower on 5-8 units, and seasoning varies by program.
No. Our investor loans are business-purpose loans on non-owner-occupied property.
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