Washington's older neighborhoods have a supply of small walk-ups and converted houses with five to eight units, from Capitol Hill and Wallingford in Seattle to Tacoma's Hilltop and Spokane's Browne's Addition.
In short: Yes. LendingStreet finances 5 to 8 unit rental buildings in Washington 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 Washington, the real estate excise tax, the statewide limit on rent increases and seismic exposure are the items that decide most files.
Seattle has small buildings in Capitol Hill, Queen Anne, Wallingford, Fremont, the University District and Columbia City, at high prices per unit. Tacoma has them in the Stadium District, Hilltop and the North End, at lower prices. Everett, Bremerton and Bellingham have smaller numbers.
Spokane has a large supply of older brick walk-ups in Browne's Addition, the South Hill and near Gonzaga, and Vancouver has small complexes near downtown. Prices east of the Cascades are more moderate.
| Area | Typical buildings | What to check |
|---|---|---|
| Seattle | Walk-ups and conversions | High prices; tenant rules |
| Tacoma, Everett | Older small buildings | Price per unit, condition |
| Spokane | Brick walk-ups | Seismic, older systems, heat |
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 |
Western Washington sits in an active seismic zone, and older unreinforced masonry buildings in Seattle, Tacoma and Spokane raise questions for insurers and underwriting. Seattle has been working on rules for retrofitting these buildings. Earthquake coverage is usually separate, so ask your agent about cost and availability.
Heavy rain west of the Cascades makes roofs, gutters, drainage and siding common inspection items. East of the Cascades, wildfire is a growing factor for insurers, and Spokane winters bring snow and freeze risk. Get a quote early.
Washington charges a real estate excise tax (REET) on sales, with graduated state rates that rise with the price, plus a local share set by the city or county. It is customarily paid by the seller, but on a building you later sell it becomes your cost, so it belongs in your long-term math. Buyers pay title, recording, appraisal and lender costs at purchase.
Washington has no state income tax, and property taxes are moderate compared with many states, though they vary by county and levy district. Voter-approved levies for schools, transit and parks can add to the bill. Use the county assessor's current figures and check for new levies.
This example is illustrative and not a quote. An investor buys a Spokane South Hill six-unit building for $780,000. Each unit rents for about $1,250 a month, so gross rent is $7,500. Property taxes are budgeted at $650 a month and insurance at $325. 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 $585,000. On 30-year amortization, principal and interest is about $4,090, so the payment with taxes and insurance is about $5,065 and the DSCR is about 1.48x.
That clears the 1.0x standard minimum. After the owner-paid costs, about $2,035 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 | $780,000 |
| Gross monthly rent | $7,500 |
| Loan amount | $585,000 |
| Principal and interest | $4,090 |
| Property taxes | $650 |
| Insurance | $325 |
| Monthly payment (PITI) | $5,065 |
| DSCR | About 1.48x |
In 2025 Washington adopted a statewide limit on annual rent increases for most residential rentals, with exemptions for newer buildings, and it requires longer notice for increases. Confirm the current cap before you plan rent changes. Washington also requires a qualifying reason to end most tenancies.
Seattle adds its own rules, including rental registration and inspection, longer notice periods, limits on move-in fees and relocation assistance in some cases. Tacoma and other cities have their own programs. Use in-place rents in your numbers, and check current rules with a local attorney.
In Seattle, prices per unit are high relative to rent, and leverage often has to come down to clear 1.0x. Many Seattle investors in this size range focus on long-held buildings with below-market rents, which take time to adjust under the new rent limits.
In Spokane, Tacoma and Vancouver, prices are more moderate, and many small buildings clear the ratio at standard leverage. Spokane's older brick buildings near downtown often show strong rent relative to price, though condition and seismic questions need attention.
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.
By custom the seller pays the real estate excise tax.
Yes. A 2025 law limits annual increases for most residential rentals, with exemptions for newer buildings.
They affect rent plans. Underwriting uses current rents.
Usually it is separate and optional, but ask for older brick buildings.
Yes. Cash-out goes up to 75% LTV, often lower on 5 to 8 units, and the rent has to cover the new payment at the program minimum. Seasoning rules vary by program.
Our DSCR programs have no stated maximum. Loans start at $150,000, and larger balances are reviewed case by case, often with lower maximum LTV.
The standard minimum is 1.0x, meaning rent covers principal, interest, taxes and insurance. Sub-1.0 programs exist for buildings that fall a little short.
Yes. LLC borrowers are standard. You will sign for the loan personally, and you will need the LLC's formation documents and operating agreement.
2-3 competing quotes from 30+ capital sources. No credit pull. No commitment.
By clicking, you provide express written consent to be contacted by LendingStreet (NMLS #1734316) via SMS, phone, or email, possibly using automated technology, regarding your loan inquiry. Reply STOP to opt out. Consent is not required to obtain services. See our Privacy Policy and Terms.