A short-term loan gets a San Francisco building bought or renovated. A rate-and-term DSCR refinance is how you keep it: one long-term payment, sized to the leases you signed, with no cash taken out.
In short: LendingStreet refinances San Francisco rentals of 1 to 8 units into DSCR loans that pay off a bridge, hard money or existing loan, up to 80% LTV on some rate-and-term programs. The loan qualifies on the property's rent with a 1.0x standard minimum DSCR, a 620 minimum credit score and no W-2s or tax returns, and 30-year terms are available. In San Francisco the usual goal is moving from an interest-only short-term payment to a stable long-term one.
The typical borrower bought a San Francisco building with a bridge or rehab loan, renovated it, leased the vacant units and now needs to retire the short-term debt before it matures. Others hold an adjustable-rate loan that is about to reset, or a loan from a private party with a balloon date approaching.
Rate-and-term means the new loan pays off existing debt and closing costs, with little or no cash to you. Because no equity is being pulled, some programs allow higher leverage than a cash-out, up to 80% LTV, and seasoning is generally less of an issue.
This example is illustrative and not a quote. An investor bought a Glen Park two-unit building for $1,500,000 with a bridge loan, finished light updates, and leased both flats for $4,600 and $4,100. The building now appraises at $1,800,000. The bridge balance is $1,050,000, and taxes on the reassessed value plus insurance run $1,820 a month.
A refinance that pays off the full balance lands at 0.99x, just under the 1.0x standard minimum. Paying the balance down to $980,000 lifts it to 1.04x. The alternative is a sub-1.0 DSCR program at the full payoff. Either way, the investor trades a short-term, interest-only note for a 30-year payment and removes maturity risk.
| Item | Current bridge loan | Refinance, full payoff | Refinance after paydown |
|---|---|---|---|
| Loan balance | $1,050,000 | $1,050,000 | $980,000 |
| Payment type | Interest-only, short-term | 30-year amortizing | 30-year amortizing |
| Principal and interest (estimated) | $8,312 | $6,986 | $6,520 |
| Taxes and insurance | $1,820 | $1,820 | $1,820 |
| Total monthly payment | $10,132 | $8,806 | $8,340 |
| DSCR at $8,700 rent | 0.86x | 0.99x | 1.04x |
The refinance qualifies on signed leases, so time it after units are rented, not before. In San Francisco, a unit leased after the purchase becomes a regulated tenancy if the building is covered by the Rent Ordinance, which means the rent you sign now is the base for years. Price leases at market, documented with comparable listings, before you order the appraisal.
Give yourself at least 60 to 90 days before the short-term loan matures. Appraisals of older buildings, title work and insurance can take longer than expected, especially with earthquake coverage involved. If the maturity date is close, ask your current lender about an extension in writing before you start, so the refinance is not a race.
A refinance does not trigger reassessment. If you bought recently, though, your bill already reflects your purchase price plus any supplemental assessment for completed improvements. Use the current tax bill and any pending supplemental bill in your numbers, not the prior owner's figure from the listing.
If you added square footage or a unit, the Assessor-Recorder may add the value of that new construction to your base. Ask whether a supplemental bill is still coming.
Investors who renovated with a hard money or fix and flip loan use the same refinance path. The appraisal reflects the finished condition, and the DSCR test uses the new leases. Bring the final permit sign-offs from the Department of Building Inspection; unpermitted or unfinaled work can reduce value or delay the loan.
If you want to take equity out at the same time, that becomes a cash-out refinance, with its own maximum LTV and seasoning rules.
The difference is where the money goes. A rate-and-term loan retires existing debt; a cash-out sends equity to you. Rate-and-term programs can allow up to 80% LTV, while cash-out tops out at 75%, and cash-out has stricter seasoning on recent purchases.
For many San Francisco buildings, the ratio, not the LTV ceiling, sets the limit. Rents relative to value mean the payment usually caps out before the LTV does.
If a San Francisco refinance is close to the line, consider whether a small amount of cash in, rather than out, buys a meaningfully better ratio and a cleaner approval. Often it does.
If you hold five or more rentals with short-term loans, a blanket portfolio loan can refinance them together with one closing and one payment, qualified on combined cash flow. That can help when one San Francisco building's ratio is thin and others in the portfolio are stronger.
Blanket loans include release provisions, so you can sell one property later without refinancing the rest. If your San Francisco building is paired with rentals in higher-yield California markets, the combined cash flow often supports more leverage than the city building could on its own.
Ask about this early if several short-term loans mature within a few months of each other. Refinancing them together can save repeated closing costs and paperwork.
Send the address, current loan balance and maturity date, rent roll and estimated value through the form below or call (877) 298-1001. We will compare a full payoff with a paydown option and show which program fits. See our California rate-and-term page for statewide terms.
A refinance that pays off existing debt and closing costs with a long-term DSCR loan, without taking meaningful cash out. It qualifies on the property's rent.
Up to 80% LTV on some programs, subject to the DSCR test. Larger balances and 5-8 unit buildings may have lower limits; it varies by program.
You can, but the vacant unit lowers qualifying rent. Leasing it first usually produces a stronger loan.
We want to see the work finaled by the city. Open permits can affect value and the timeline.
No. A refinance is not a change in ownership under Prop 13. New construction or additions can be assessed separately.
Pay the balance down, choose a sub-1.0 DSCR program, or raise rents at turnover before refinancing.
Yes. LLC borrowers are standard. Check the property tax effect of any title change with the Assessor-Recorder first.
Plan on several weeks. Start at least 60 to 90 days before your current loan matures.
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