Virginia's older cities have plenty of small multifamily: converted townhouses in Richmond's Fan, brick walk-ups in Norfolk's Ghent, garden buildings in Northern Virginia and older buildings in Roanoke and Lynchburg.
In short: You can finance a 5 to 8 unit building in Virginia with a LendingStreet DSCR loan that qualifies on rent, from $150,000 with no stated maximum and 30-year terms available. The rent has to cover principal, interest, taxes and insurance at 1.0x on standard programs, and sub-1.0 programs exist. In Virginia, the recordation tax on your new loan, local tax rates and coastal flooding in Hampton Roads are the items to check.
Richmond has small buildings in the Fan, the Museum District, Church Hill, Carytown and near VCU, many of them large townhouses or early 1900s brick buildings split into apartments. Norfolk has them in Ghent, Colonial Place and near Old Dominion University, and Hampton and Newport News add more near the shipyards and bases.
Northern Virginia has small garden buildings in Arlington, Alexandria and Falls Church, at very high prices. Roanoke, Lynchburg, Harrisonburg, Charlottesville and Blacksburg have smaller buildings at more moderate prices, often tied to universities.
| Area | Typical buildings | What to check |
|---|---|---|
| Richmond: Fan, Museum District | Townhouse conversions, brick buildings | Legal unit count, older systems |
| Norfolk, Hampton, Newport News | Walk-ups near bases and campuses | Flood risk, insurance |
| Roanoke, Lynchburg, Harrisonburg | Older small buildings | Student turnover, condition |
Start with the rent roll. Add the in-place rent for each unit and, for any vacant unit, a market rent the appraiser can support. Then divide by the full payment, including taxes and insurance. That ratio needs to be 1.0x or higher on standard programs.
Utilities the owner pays, such as common-area electric, water, sewer and trash, are not part of the DSCR payment on most programs, but they are part of your real cash flow. Budget for them separately so the deal still works after the loan closes, not just on the term sheet.
Leverage on 5 to 8 units varies by program and is often below the 80% purchase maximum available on smaller rentals. Cash-out refinances go up to 75% LTV, and seasoning rules vary. If the ratio comes in short, lowering the loan amount or using a sub-1.0 program are the usual fixes.
| 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 |
Virginia charges a recordation tax on deeds and on new deeds of trust, with a state rate and an added local share. The tax on your new loan is usually paid by the buyer. Sellers typically pay the grantor's tax. Ask your title company or settlement attorney for the figures.
Property taxes are set by each city and county, and Virginia's independent cities have their own rates. Use the current assessment and the local rate, and expect annual reassessments in many localities.
Hampton Roads has some of the highest rates of tidal and storm flooding on the East Coast, and parts of Norfolk flood regularly. Check the flood map and flood history before you buy. If flood coverage is required, the premium counts in the ratio.
Elsewhere in Virginia, insurance is more moderate. Older buildings in Richmond and Roanoke may have older wiring and roofs, so inspect early.
This example is illustrative and not a quote. An investor buys a Richmond Fan District six-unit building for $1,050,000. Each unit rents for about $1,500 a month, so gross rent is $9,000. Property taxes are budgeted at $950 a month and insurance at $350. The owner also pays about $350 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 $787,500. On 30-year amortization, principal and interest is about $5,506, so the payment with taxes and insurance is about $6,806 and the DSCR is about 1.32x.
That clears the 1.0x standard minimum. After the owner-paid costs, about $1,844 a month is left before vacancy, repairs and management, which is why a realistic expense budget matters as much as the ratio.
| Item | 75% LTV |
|---|---|
| Purchase price | $1,050,000 |
| Gross monthly rent | $9,000 |
| Loan amount | $787,500 |
| Principal and interest | $5,506 |
| Property taxes | $950 |
| Insurance | $350 |
| Monthly payment (PITI) | $6,806 |
| DSCR | About 1.32x |
The Virginia Residential Landlord and Tenant Act sets rules for deposits, notices and repairs, and has been amended several times in recent years. Virginia does not allow local rent control.
Some cities, including Richmond and Norfolk, have rental inspection districts for older buildings. Check with the city before closing.
Norfolk, Virginia Beach and Hampton have strong demand from Naval Station Norfolk, Langley and the shipyards. Richmond draws from VCU, health care and state government. Blacksburg and Charlottesville have university demand.
In Northern Virginia, prices are high relative to rent, and leverage often has to come down. For larger loans, see our Northern Virginia jumbo DSCR page.
Most delays on small apartment loans come from missing items. Start with these.
Our investor loans are business-purpose loans on non-owner-occupied property. Tell us about the building: address, unit mix, rents, taxes, insurance and the loan you have in mind. We will run the numbers, flag any local issues that could affect the file and give you options. Fill out the form below or call (877) 298-1001.
Nine or more units is commercial financing, covered on our multifamily loans page.
Yes. Virginia charges a recordation tax on new deeds of trust. Ask your settlement attorney for the figure.
If the building is in a mapped flood zone, flood insurance is generally required. Many Norfolk owners carry it outside those zones too.
No. Virginia does not allow local rent control.
Some areas are in rental inspection districts. Check with the city.
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.
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.
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