Wichita has a long tradition of small landlords selling rentals on contract or with owner financing, and of local banks writing short balloon loans on investment property. Years later, those notes come due. A rate-and-term DSCR refinance replaces them with a long-term loan built around the rent.
In short: LendingStreet offers DSCR rate-and-term refinances on Wichita rentals to pay off balloon notes, seller financing, hard money, bridge loans or an existing mortgage. Rate-and-term goes up to 80% LTV on some programs, loans start at $150,000, the standard minimum DSCR is 1.0x and the minimum credit score is 620. We qualify on the property's rent, with no W-2s or tax returns.
The loans being replaced vary, but each comes with its own paperwork and timing issues.
| Existing loan | Why refinance | What to bring |
|---|---|---|
| Seller-carry note or contract for deed | Balloon date approaching; get title and a long-term payment | Note or contract, payment history, recorded documents |
| Local bank balloon or adjustable loan | Maturity or rate reset | Payoff letter, current statement |
| Hard money or fix and flip loan | Rehab finished; end short-term interest | Leases, receipts, final inspections |
| Bridge loan used for lease-up | Building now stabilized | Rent roll, leases, current tax bill |
When a rental is bought on a contract for deed, the seller may keep legal title until the contract is paid. Refinancing pays off the contract and puts title in your name or your LLC's. The title company will need the original contract, proof of payments and the seller's cooperation to deliver the deed.
With an owner-carry note secured by a mortgage, you already hold title and the refinance simply pays off the note. Either way, start early. Older contracts are sometimes unrecorded or loosely documented, and fixing that takes time.
Kansas title companies handle most refinance closings, so bring them in as soon as you decide to move forward.
This example is illustrative and not a quote. An investor bought a triplex in south-central Wichita with seller financing. The balloon payment of $178,000 comes due in four months. The triplex appraises at $255,000 and each unit rents for $825, for $2,475 a month.
A rate-and-term refinance of $184,000 covers the payoff and about $6,000 in closing costs, about 72% LTV, and clears the $150,000 minimum. Estimated principal and interest is about $1,255. Taxes, using the 11.5% residential assessment ratio and an assumed mill levy, are about $305, and insurance is $230. The total payment is about $1,791, a DSCR of about 1.38x.
The investor replaces a balloon deadline with a 30-year payment and gets clean title in the LLC.
Rate-and-term refinances pay off existing debt, so the loan amount is close to what you owe. If you owe less than $150,000 on a Wichita house, a rate-and-term refinance of that house alone falls below our minimum. A portfolio loan that refinances several properties together, or a cash-out on a higher-value property, may fit better.
Owners with several small notes maturing around the same time often roll them into one blanket portfolio loan with one payment. That can be especially useful for landlords who bought a string of houses from the same seller on matching contracts with the same balloon year.
Investors coming off a fix and flip or hard money loan should finish all work, close out permits with MABCD and sign a lease at market rent before ordering the appraisal. A finished, leased property appraises more cleanly and supports a better loan.
Watch the maturity date on your short-term loan. Starting the refinance 45 to 60 days early leaves time for the appraisal, title and any surprises.
Many Wichita rentals have had roofs replaced through insurance claims. Keep the claim paperwork and the roofer's invoice; a newer roof can lower the insurance premium and make the refinance cleaner. An older roof with storm damage can draw questions from the appraiser and the insurer.
Lenders require the property to be insured from the day the new loan closes, with the lender named on the policy. Confirm the wind and hail deductible on the new policy. It does not change the payment directly, but it affects how much cash you should hold in reserve.
If the appraisal shows substantial equity above what you owe, a cash-out refinance up to 75% LTV may make sense, subject to seasoning. If you just need to replace a loan, rate-and-term is simpler and can allow higher leverage on some programs. Many Wichita landlords do a rate-and-term first and a cash-out later. Doing it in that order replaces the expiring note quickly and leaves room to tap equity once seasoning is met and any renovations are reflected in the value.
Older Wichita rentals bought through private deals sometimes carry title issues: an unreleased mortgage from a loan paid off years ago, a contract never recorded, or a deed that names an individual when the property should be in an LLC. Any of these can stop a refinance at the last minute.
Order a title search as soon as you decide to refinance. If an old lien shows up, the title company can usually track down the lender or note holder for a release, but that takes time. If the seller on a contract for deed has passed away, their estate may need to sign, which can take longer still. Starting early protects your balloon date.
Send the address, current payoff, estimated value, rent and the type of loan you are replacing. We will show the new payment and ratio. Use the form below or call (877) 298-1001. Our investor loans are business-purpose loans on non-owner-occupied property.
Yes, if the seller can deliver title at payoff. The title company will need the contract, payment history and the seller to sign.
Up to 80% LTV on some programs, subject to the rent covering the payment at the program minimum.
Not as a single loan, because our minimum is $150,000. A portfolio loan on several rentals, or including other properties, may work.
No. We qualify on the property rent and your credit, with a 620 minimum score.
45 to 60 days is a good target, and earlier if title needs cleanup.
Usually, yes. LLC borrowers are standard. Talk to us and your title company about the deed before closing.
No. Our investor loans are business-purpose loans on non-owner-occupied property.
A property bought with cash and owned free and clear is usually refinanced as a cash-out, up to 75% LTV, subject to seasoning rules that vary by program.
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