Allentown, Bethlehem and Easton are full of brick rowhomes, twins and converted multi-unit houses. Investors buy them with short-term money, bring them up to rental code and then look for a long-term loan that the rent can carry.
In short: LendingStreet refinances Lehigh Valley rentals out of hard money, bridge and existing loans with 30-year DSCR loans that qualify on rent. Loans start at $150,000, rate-and-term reaches 80% LTV on some programs and the standard minimum DSCR is 1.0x. In Allentown the file usually turns on two items: a current rental license and a school tax bill that is often the largest part of the monthly escrow.
In Allentown, the West End has larger twins and single-family homes, while Center City and the East and South sides have dense rowhome blocks and houses converted into two to four units. Bethlehem's South Side near Lehigh University and Easton's College Hill near Lafayette add student and young-professional demand.
The region's warehouse and logistics growth along I-78 and Route 22, plus commuters heading toward New Jersey and New York, keep rental demand steady. Prices are lower than in the New York and New Jersey suburbs, which is part of why investors from those markets buy here.
| Area | Typical rental stock | What to check before you refinance |
|---|---|---|
| Allentown West End | Twins and single-family homes | School and city tax millage |
| Allentown Center City, East and South sides | Rowhomes and converted multi-unit houses | Rental license, unit legality, separate meters |
| Bethlehem South Side | Rowhomes near Lehigh University | Student lease terms and occupancy limits |
| Easton, College Hill, Phillipsburg area | Older twins and small buildings | City inspection rules and flood maps near the rivers |
Investors here often finish a renovation on a hard money or bridge note that is interest-only and due within a year or two. Moving that balance into a 30-year DSCR loan stops the maturity clock. LLC borrowers are standard, the minimum credit score is 620 and leverage on rate-and-term reaches 80% LTV on some programs.
Converted rowhomes are common in Allentown, and the appraiser and underwriter will want to see that every unit is legal. Bring the rental license, certificates from city inspections and any zoning approvals for the unit count. A unit that the city does not recognize usually cannot be counted toward the rent.
This example is illustrative and not a quote. An investor renovated a three-unit rowhome conversion on Allentown's East Side with a hard money loan. Each unit leases for $1,150, the city license is current and the building appraises at $300,000. The payoff is $205,000.
The new loan of $213,000 covers the $205,000 payoff plus $8,000 in closing costs, about 71% of the $300,000 value. Estimated principal and interest on a 30-year term is about $1,471. With taxes of $520 and insurance of $190 a month, the full payment is about $2,181 and DSCR is about 1.58x on $3,450 of rent.
The tax line is the largest cost after principal and interest, which is typical for Lehigh Valley rentals.
Two inputs move this math the most: the appraised value, which caps the loan amount, and the tax and insurance figures, which sit in the payment. A small change in either can move the ratio across the 1.0x line, so check both early.
| Item | Before: hard money note | After: DSCR rate-and-term |
|---|---|---|
| Loan balance | $205,000 | $213,000 |
| Monthly principal and interest | $1,965 (interest only) | $1,471 |
| Taxes, insurance | $710 | $710 |
| Total monthly payment | $2,675 | $2,181 |
| DSCR at $3,450 rent | About 1.29x | About 1.58x |
| Term | Short-term, due soon | 30 years |
Pennsylvania property taxes are set by the county, the municipality and the school district, and the school district share is usually the largest. Lehigh and Northampton counties do not reassess often, so assessed values can lag market values, and taxes depend heavily on local millage.
Tax bills in Pennsylvania may come in more than one installment during the year, with school taxes billed separately. When you send your refinance package, include every bill so the escrow is calculated on the full annual amount. Realty transfer tax applies to deed transfers, not to a refinance that keeps title in the same name.
Allentown requires rental units to be licensed and inspected, and Bethlehem and Easton have their own rental registration and inspection programs. Keep your license current and resolve any open code violations before the refinance, since title and underwriting may ask about them.
Older brick rowhomes can have aging roofs, knob-and-tube wiring and older heating systems. Insurers price those risks, so a renovation that replaced them should be documented.
Many Lehigh Valley rentals are two to four units in one building, and they qualify on the combined rent of all units. Larger converted homes and small apartment buildings with five to eight units are still residential for DSCR purposes, though max LTV varies by program.
Rate-and-term pays off what you owe plus closing costs. Cash-out goes further and lets you pull equity, up to 75% LTV, but it usually carries a larger balance and a higher payment, and seasoning rules vary by program. If the goal is a lower payment or a longer term, rate-and-term is often the cleaner file.
Investors from New Jersey and New York who bought in Allentown for cash flow often choose rate-and-term to keep the payment low against the region's higher tax bills.
Most delays come from missing paperwork. Gather these before the appraisal is ordered.
Request a quote with the property address, the current payoff and the rent roll. LendingStreet works with investors refinancing in Lehigh and Northampton counties, including Bethlehem and Easton, checks the ratio on realistic taxes and insurance and lays out 2-3 options, including sub-1.0 DSCR programs where they fit. Our investor loans are business-purpose loans on non-owner-occupied property. See the Pennsylvania rate-and-term refinance page for state-level detail, or call (877) 298-1001.
You should have one. Allentown requires rental units to be licensed and inspected, and underwriting may ask for it to confirm the units are legal.
School district taxes are usually the largest part of the bill. Include the school, county and municipal bills so the escrow is accurate.
Realty transfer tax applies to deed transfers. A refinance that keeps the same owner on title generally does not trigger it, but confirm with your title company.
Yes, if the units are legal and leased. Student leases are fine, and the rent from all units counts toward the ratio.
No. Our investor loans are business-purpose loans on non-owner-occupied property, so the home must be a rental, not your residence.
DSCR loans start at $150,000 with no stated maximum. Larger balances get more review and can carry lower leverage.
If you own five or more investment properties, a blanket portfolio loan can combine them under one loan with one closing and one payment, qualified on portfolio cash flow.
Yes. 30-year terms are available on our DSCR programs, which is what lowers the monthly payment compared with an interest-only short-term note.
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