Many Portland-area rentals start life on short-term money: a hard money loan for the rehab, a bridge loan for a fast close, or a balloon note from the seller. A rate-and-term DSCR refinance replaces that debt with a long-term loan sized on the rent the property now earns.
In short: LendingStreet refinances 1-8 unit rentals in greater Portland, Maine with DSCR rate-and-term loans that pay off hard money, bridge or existing mortgages, up to 80% LTV on some programs. The loan qualifies on property rent with no W-2s or tax returns, 30-year terms are available, and the standard minimum DSCR is 1.0x.
A rate-and-term refinance pays off existing debt and closing costs without taking significant cash out. It fits when a short-term loan is coming due, when an interest-only payment is eating your cash flow, or when you want a fixed long-term payment after finishing a rehab. Because no cash is taken out, seasoning rules are often easier than on a cash-out.
It is also a common next step after a bridge or hard money loan used to buy a building that needed work. Once the work is finished and the units are leased, the property can support a long-term loan sized on its new value and rent.
This example is illustrative and not a quote. An investor bought and renovated a Westbrook duplex with a bridge loan that now has a balance of $395,000. Estimated interest-only payments on that loan are about $3,456 a month, and it matures in four months. The finished duplex appraises at $545,000 and rents for $1,950 and $1,825, or $3,775 combined.
A new DSCR loan of $404,000 pays off the bridge balance and about $9,000 of closing costs, for an LTV of about 74%. Estimated principal and interest on a 30-year term is about $2,756. With taxes of $575 and insurance of $185, the payment is $3,516 and the DSCR is about 1.07x.
The new payment is lower and fixed, and the maturity risk is gone.
| Item | Bridge loan today | DSCR refinance |
|---|---|---|
| Balance | $395,000 | $404,000 |
| Payment type | Interest-only, short term | 30-year amortizing |
| Principal and interest (or interest only) | $3,456 | $2,756 |
| Maturity | About four months | 30 years |
| Ratio at $3,775 rent | - | 1.07x |
Start the refinance at least 45 to 60 days before your short-term loan matures. Appraisals in smaller Maine markets can take time to schedule, and you want leases signed and units occupied before the appraiser visits. If your maturity is close, ask your current lender about a short extension as a backup.
Gather your documents early: the payoff letter from your current lender, signed leases, proof of rents received, your insurance declaration and your LLC documents. A complete file at the start avoids last-minute requests during the final weeks before maturity.
In Portland, Westbrook and South Portland, comparable sales for renovated two-families can be thin. Give the appraiser your scope of work, permits and photos, and list recent sales of similar buildings. Market rent for each unit will also be estimated, and that number feeds directly into the DSCR.
If the appraisal comes in lower than you hoped, you may need to bring cash to closing to keep the loan inside the program's maximum LTV, or keep the bridge loan a little longer while you lease more units. Planning a cushion avoids a forced decision near maturity.
Investors usually come to us with one of these.
Each of these starts with the same questions: what the property is worth today, what it rents for, and what the payment would be on a long-term loan. Bring those numbers and we can tell you quickly whether a rate-and-term refinance clears the ratio.
If the property is in Portland, check whether the units fall under rent stabilization and whether the property is registered with the city's rental housing program. New leases signed after renovation are the strongest support for the qualifying rent. Westbrook and South Portland have separate rules.
For a vacant unit, consider signing a lease before the appraisal visit. A signed lease at market rent supports the qualifying income far better than an estimate.
If the property appraises high enough that you could take cash out, a cash-out refinance may make sense, up to 75% LTV. If you only need to retire the existing debt, rate-and-term keeps the loan smaller and the ratio stronger. We can price both so you can compare.
Ask for both quotes at the same time so the appraisal can serve either path.
Many Portland-area rentals have owner-paid heat and long-term tenants, which makes cash flow sensitive to surprises. A fixed 30-year payment takes one variable out of the picture. You know your principal and interest for the life of the loan, so changes in heating costs, taxes or insurance are easier to plan around.
A longer amortization also lowers the monthly payment compared with a shorter term, which usually improves the DSCR. That can be the difference between a building that qualifies at 1.0x and one that does not.
Our investor loans are business-purpose loans on non-owner-occupied property. Send your current loan statement, maturity date, leases and the property address through the form below or call (877) 298-1001. See our Maine rate-and-term page for statewide notes.
Yes. Paying off hard money or bridge loans after a rehab is one of the most common uses of a DSCR rate-and-term refinance.
Up to 80% LTV on some programs, enough to pay off the existing loan and closing costs, as long as the DSCR meets the program minimum.
Signed leases help a lot. Lenders may use market rent on vacant units on some programs, but leased units give the clearest support.
Plan on several weeks, mostly for the appraisal. Start well before your current loan matures.
Requirements are often lighter than for cash-out, but they vary by program.
Yes. We lend on 1-8 unit rentals throughout the greater Portland area.
You can bring in cash to reduce the loan, or look at our sub-1.0 DSCR programs, which accept a lower ratio on some files.
On a rate-and-term refinance, closing costs can usually be included in the new loan, as long as the LTV and DSCR stay within program limits.
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