Utah's Wasatch Front has a steady supply of small apartment buildings: older walk-ups and converted houses in Salt Lake City, student buildings near BYU and Utah State, and 1970s complexes in Ogden.
In short: Yes. LendingStreet finances 5 to 8 unit rental buildings in Utah with DSCR loans that qualify on the building's rent, with no W-2s or tax returns and LLC borrowers standard. Loans start at $150,000 with no stated maximum, the standard minimum DSCR is 1.0x and the minimum credit score is 620, while maximum LTV on 5 to 8 units can be lower than on 1 to 4 units and varies by program. In Utah, high prices relative to rent along the Wasatch Front, seismic exposure and student-market lease cycles are the items that decide most files.
Salt Lake City has small buildings in the Avenues, Central City, Liberty Wells, Sugar House and near the University of Utah, many of them brick walk-ups from the early and mid 1900s or larger houses split into apartments. Ogden has small buildings near downtown and Weber State, at lower prices.
Provo and Orem have many student-oriented buildings near BYU and Utah Valley University, and Logan has them near Utah State. St. George has newer small complexes, with demand from retirees and seasonal residents.
| Area | Typical buildings | What to check |
|---|---|---|
| Salt Lake City: Avenues, Central City | Brick walk-ups and conversions | Seismic, older systems |
| Provo, Orem, Logan | Student-oriented buildings | Per-bedroom leases, turnover |
| Ogden, St. George | Older and newer small complexes | Price per unit; STR rules |
The ratio is simple: total monthly rent from all units divided by the monthly payment, which includes principal, interest, property taxes, insurance and any HOA dues. On standard programs it has to reach 1.0x, and a higher ratio can improve terms. Sub-1.0 programs exist for buildings that fall a little short.
Appraisers on 5 to 8 unit buildings usually look at both comparable sales and the income the building produces, and they give an opinion of market rent for each unit. If the in-place rents are well below market, underwriting generally works from the leases you actually have, so a building with old below-market leases may size smaller than its potential suggests.
For our programs, 5 to 8 units is still residential, so the loan is underwritten like a larger version of a fourplex loan rather than a commercial apartment loan. The difference is that maximum LTV can be lower on 5 to 8 unit properties and on larger balances, and reserve requirements can be higher. Both vary by program.
| Term | What to expect |
|---|---|
| Property type | 5 to 8 unit residential rental |
| Loan amount | From $150,000, no stated maximum |
| Purchase LTV | Up to 80% on some programs; often lower on 5-8 units |
| Cash-out LTV | Up to 75%; varies by program |
| Minimum DSCR | 1.0x standard; sub-1.0 programs exist |
| Credit score | 620 minimum |
| Income documents | None; qualifies on rent |
| Borrower | LLC standard; sign for the loan personally |
Utah does not charge a real estate transfer tax, so closing costs on a 5 to 8 unit purchase are mostly title, recording, appraisal and lender costs.
Property taxes in Utah are moderate. How a residential property is taxed can depend on whether the units are used as primary residences, and short-term rentals are generally taxed differently from long-term rentals. Confirm the treatment with the county assessor before you set your budget.
The Wasatch Fault runs along the Front, and older unreinforced masonry buildings in Salt Lake City raise seismic questions. Earthquake coverage is usually separate, so ask your agent about it and whether underwriting requires it for older brick buildings.
Winters bring snow and freeze risk, especially in Logan and the higher-elevation areas. Roofs, boilers and older plumbing are common inspection items.
This example is illustrative and not a quote. An investor buys a Salt Lake City six-unit building for $1,450,000. Each unit rents for about $1,400 a month, so gross rent is $8,400. Property taxes are budgeted at $725 a month and insurance at $400. The owner also pays about $400 a month in utilities and common-area costs, which affect cash flow but are not part of the DSCR payment.
At 75% LTV the loan is $1,087,500. On 30-year amortization, principal and interest is about $7,604, so the payment with taxes and insurance is about $8,729 and the DSCR is about 0.96x.
That is below the 1.0x standard minimum. At 70% LTV the loan drops to $1,015,000, principal and interest is about $7,097, the payment is about $8,222 and the DSCR rises to about 1.02x. The investor brings $72,500 more to closing.
| Item | 75% LTV | 70% LTV |
|---|---|---|
| Purchase price | $1,450,000 | $1,450,000 |
| Gross monthly rent | $8,400 | $8,400 |
| Loan amount | $1,087,500 | $1,015,000 |
| Principal and interest | $7,604 | $7,097 |
| Property taxes | $725 | $725 |
| Insurance | $400 | $400 |
| Monthly payment (PITI) | $8,729 | $8,222 |
| DSCR | About 0.96x | About 1.02x |
Many buildings near BYU, UVU and Utah State rent per bedroom on academic-year contracts, and some are approved housing for a specific university. Underwriting looks at how rents are set and how stable they are. Bring a rent roll that shows lease dates and occupancy.
Utah's Fit Premises Act and landlord-tenant statutes set rules for deposits and notices, and Utah does not allow local rent control. Salt Lake City, Park City and St. George regulate short-term rentals in residential zones.
Utah's population growth and limited land have pushed prices up faster than rents in many neighborhoods. A 5 to 8 unit building in Salt Lake City or Provo often needs a larger down payment to clear the 1.0x minimum. Ogden and smaller cities are usually easier.
Use in-place rents and a realistic insurance quote, and run the numbers at a few loan amounts before you set your offer.
A complete package gets a faster, clearer answer on a 5 to 8 unit building.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the address, price, rent roll and the loan amount you want. The team will run the ratio on realistic taxes and insurance, check it at a few loan amounts and come back with options, including sub-1.0 DSCR programs where they fit. Use the form below or call (877) 298-1001.
Buildings with nine or more units are commercial; for those, see our multifamily page.
No. Utah does not charge a real estate transfer tax.
Often, yes. Expect underwriting to look at how rents are set, lease dates and occupancy.
It is usually separate and optional, but ask about it for older brick buildings.
No. State law does not allow local rent control.
Purchase loans go up to 80% LTV on some programs, but 5 to 8 unit buildings and larger balances often get less. Plan for 20% to 30% down plus reserves, depending on the program and the ratio.
No. The loan qualifies on the building's rent. You need a 620 or higher credit score, reserves and entity documents if you buy in an LLC.
Vacant units can often be counted at a market rent the appraiser supports, but some programs want a minimum number of units leased. It varies by program, so tell us about vacancies up front.
On our programs, 1 to 8 units is residential, so 5, 6, 7 and 8 unit buildings qualify for a DSCR loan on rent. Nine or more units moves to commercial financing.
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