A lot of Lincoln rentals are financed with local bank loans that reset or balloon every few years. A rate-and-term DSCR refinance trades that cycle for a long-term schedule sized to the rent.
In short: LendingStreet's DSCR rate-and-term refinance replaces balloon notes, adjustable loans, hard money and bridge debt on 1-8 unit rentals in Lincoln and across Nebraska. It qualifies on the property's rent rather than your income, can go up to 80% LTV on some programs, and offers 30-year terms. The goal is a longer term, a steadier payment or a cleaner structure, with little or no cash out.
Community banks lend actively to Nebraska landlords, often on commercial-style terms: a short fixed period, a balloon after five years or so, and a 15-, 20- or 25-year amortization. Those loans work well until the balloon arrives and the bank asks for updated personal financials, a new rate or a paydown. A DSCR loan is underwritten on the property and offers 30-year terms.
Other common files are rehabbed houses still on fix and flip or bridge financing, properties held in a personal name that the owner wants to move into an LLC, and buyouts of a partner.
This example is illustrative and not a quote. An investor owns a duplex in College View worth $340,000. The bank note has a balance of $236,000 and a balloon due this year, on a 20-year amortization. Each side rents for $1,325, or $2,650 a month, with taxes of about $535 and insurance of $170.
To isolate the effect of term, assume the same interest rate on both loans. On a 20-year schedule, principal and interest on the current balance is about $1,901 and the total payment about $2,606, a DSCR of about 1.02x. A new DSCR loan of $240,500, which covers the balance and about $4,500 in closing costs at about 70.7% LTV, on a 30-year schedule has estimated principal and interest of about $1,682, a total of about $2,387 and a DSCR of about 1.11x.
| Item | Bank note, 20-year schedule | DSCR loan, 30-year schedule |
|---|---|---|
| Loan balance | $236,000 | $240,500 |
| Estimated principal and interest | $1,901 | $1,682 |
| Taxes | $535 | $535 |
| Insurance | $170 | $170 |
| Total payment | $2,606 | $2,387 |
| DSCR at $2,650 rent | 1.02x | 1.11x |
| Balloon | Due this year | None; fully amortizing |
The example shows how much of a Lincoln landlord's payment can come from a short amortization rather than the rate. Spreading the same balance over 30 years lowers the monthly payment and lifts DSCR, which leaves more room for Nebraska's tax bill and for repairs. It also removes the balloon, so you are no longer renegotiating with a bank every few years on its terms. You pay down principal more slowly, so some investors choose a 30-year term and make extra payments when cash flow allows.
A refinance does not trigger a new valuation, but the Lancaster County Assessor revalues property regularly, and the new loan's escrow will be set from the current bill. Use the latest valuation notice when you model the payment. If you think the value is too high, the county's protest period in early summer is the time to raise it.
If you rehabbed the property with short-term money, line up the refinance before extension fees start. Lease the property first, since a signed lease at market rent is the strongest support for the ratio. Close out permits with Lincoln's Building and Safety Department and keep receipts for the work. Some programs use the post-rehab appraised value soon after the project; others limit the loan until you have owned it longer. The rules vary by program.
Lincoln has plenty of comparable sales in most established neighborhoods, which helps. Near campus, appraisers will look at both the sale comparables and the rent comparables for similar units, so share your leases, the unit mix and any recent upgrades such as a new roof, windows or a furnace. Bedrooms in basements need legal egress to count.
Appraisals in Lincoln usually turn around quickly, but spring and early summer are busy, so order early if your balloon date is close.
If you only need to retire the existing loan and cover costs, rate-and-term is the cleaner option and allows higher leverage on some programs. If you want to pull equity for the next purchase, see our Lincoln cash-out page, where the limit is 75% LTV and the tax bill often decides how much you can take.
Most delays come from paperwork rather than the loan itself. A bank payoff letter for a commercial-style note can take time, and some notes carry fees for paying off before maturity, so read yours early. Title will need any contractor liens released, and an open city permit from a past project can hold up the appraisal or the closing.
Insurance is the other common snag. The new loan needs a landlord or dwelling policy naming the new lender, with a hail deductible the program accepts. Start those requests as soon as you decide to refinance.
Send the address, current loan statement and balloon date, leases, latest valuation notice and insurance premium. We will show the new payment and DSCR at a few loan amounts, and flag anything that could hold up the appraisal or title.
Use the form below or call (877) 298-1001. Our investor loans are business-purpose loans on non-owner-occupied property. Our Nebraska rate-and-term page covers the rest of the state.
A refinance that pays off existing debt and closing costs with little or no cash to you, qualified on the property's rent rather than personal income.
Yes. Maturing bank notes on 1-8 unit rentals are one of the most common rate-and-term payoffs in Nebraska.
Up to 80% LTV on some rate-and-term programs. Leverage can be lower on 5-8 unit properties and larger balances.
Usually, compared with a 15- to 25-year amortization at the same rate, because the balance is spread over more months.
DSCR loans qualify on the property. You will need credit, reserves, entity documents and property information, not tax returns.
Yes. Many investors retitle into an LLC as part of a rate-and-term refinance.
It varies by program. Some use the post-rehab value soon after completion; others limit the loan until you have owned the property longer.
Yes. We refinance 1-8 unit rentals across Nebraska, including Omaha, Grand Island, Kearney and smaller towns.
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.