You are not flipping this one. You want to buy a high-value house or small multi-unit, renovate it and keep it as a rental, and the long-term loan only works after the work is done.
In short: A rehab bridge loan funds the purchase and renovation of a high-value single-family or 2-4 unit rental, with the plan to refinance into a long-term DSCR loan once the property is finished and rented. LendingStreet's bridge programs start at 7.99%, can close in as little as 10 days and consider balances above $1M case by case. Because the exit is a refinance and not a sale, the deal is underwritten on what the finished property will rent for and appraise at, not on a resale price. The most important number is whether the future DSCR loan can pay off the bridge.
On a flip, the lender asks one question at the end: will a buyer pay enough for the house? On a hold plan, the end question is different: will a DSCR lender refinance the finished property for enough to pay off the bridge, and will the rent cover the new payment?
That shifts what matters. Resale comps and days on market take a back seat. Market rent, operating costs, insurance and the appraised value of a rental-grade renovation move to the front. A luxury finish that helps a flip sell can be wasted money on a rental if it does not raise rent or value.
If you are planning a sale instead, our page on high-balance fix and flip loans covers that exit.
| Question | Large flip | Large rehab-to-hold |
|---|---|---|
| Exit | Sale to an end buyer | Refinance into a DSCR loan |
| What sizes the exit | Resale price minus selling costs | Appraised value and market rent |
| Key risk | Slow sale or price cut | Low appraisal or rent that misses the ratio |
| Renovation focus | Buyer appeal, finish level | Durability, rentability, lower upkeep |
| After the project | Loan is paid off and you move on | You own a stabilized rental on 30-year debt |
A rehab bridge loan typically has two parts: a purchase portion funded at closing and a renovation portion held back and released in draws as work is completed and inspected. Payments are commonly interest-only, which keeps carrying costs lower while the property earns little or nothing.
On larger balances, leverage is often a step lower and reserve requirements are higher than on a typical bridge loan. Each scenario is reviewed case by case, and the financing team will show you how the purchase and rehab portions would be sized for your deal.
The smartest large rehab files start at the end. Before you sign the contract, estimate the finished value, the market rent for every unit and the taxes, insurance and any HOA dues on the completed property. Then test the DSCR loan you expect to get.
DSCR cash-out refinances go up to 75% LTV, and on larger balances the maximum is often lower. The rent has to cover the new payment at the program minimum, which is 1.0x as a standard, with some programs going lower. Seasoning rules vary: some programs refinance on the new appraised value with little seasoning, while others cap the loan at your purchase price plus documented improvements for the first several months.
If the refinance only works on the best-case appraisal, the deal is thin. Build in a margin on value and rent.
This example is illustrative and not a quote. An investor buys a dated fourplex for $1,400,000 with two units vacant. The plan is a $350,000 renovation of all four units, then a DSCR refinance.
Assume a bridge loan of 75% of the purchase price, or $1,050,000, plus the full $350,000 renovation funded through draws, for a total loan of $1,400,000. At a sample interest-only rate of 9.0%, the monthly interest is $7,875 at closing and $10,500 once all rehab funds are drawn. The investor brings $350,000 for the down payment plus sample closing costs of $45,000.
After the work, the fourplex appraises at $2,200,000 and the four units lease at $3,600 each, or $14,400 a month. Assume the DSCR program allows 70% LTV at this balance: the new loan is $1,540,000. At a sample 7.25% on a 30-year fixed, principal and interest is about $10,506. With $2,100 a month for taxes and insurance, the payment is about $12,606 and the DSCR is about 1.14x. The refinance pays off the $1,400,000 bridge and leaves about $140,000 before refinance closing costs.
| Item | Bridge stage | After DSCR refinance |
|---|---|---|
| Loan amount | $1,400,000 (incl. $350,000 rehab) | $1,540,000 |
| Payment type | Interest-only | 30-year fixed P&I |
| Monthly payment (sample) | $7,875 to $10,500 | About $12,606 incl. taxes and insurance |
| Rent | Partial | $14,400 a month |
| Coverage | Not sized on rent | About 1.14x |
Using the same numbers, suppose the refinance happens early and the program caps the loan at purchase price plus documented improvements. The cost basis is $1,750,000. At 75% of that, the loan is $1,312,500, which is less than the $1,400,000 bridge payoff. The investor would need to bring cash to close or wait.
That is why the bridge term and the seasoning rule have to fit together. Ask which seasoning rule applies on the DSCR side before you choose the bridge term, and leave enough time for the work, the lease-up and the waiting period.
On a hold plan, the expensive stretch is the gap between closing and the first full month of rent. You carry interest, taxes, insurance, utilities and sometimes HOA dues while the property earns little. In the example above, six months of interest alone at the fully drawn balance would be $63,000.
Lease-up adds time after the contractor leaves. High-value rentals can take longer to lease than starter homes, and a DSCR lender usually wants the units rented or rent-ready before the refinance. Plan your reserves around the full timeline: renovation, lease-up and any seasoning period, plus a cushion for overruns.
If the renovation runs long, ask early about extension options on the bridge rather than waiting until the maturity date is close.
At higher balances, the financing team looks harder at the same core items. None of these is unusual, but a weak spot in one of them matters more on a $1.5M loan than on a $300K one.
Some bridge programs require no appraisal, which can help when speed matters. On a large balance, expect a closer look at value. Some programs may require a full appraisal, an as-completed value or a more detailed review, especially when comparable sales are thin at the property's price level.
Remember that the DSCR refinance will require its own appraisal. That appraiser will look at the finished property as a rental, so photos, permits and a list of completed work help support the value you need.
Rental renovations pay off differently than flip renovations. Durable flooring, efficient mechanicals, updated electrical and plumbing, and layouts that rent well usually do more for a DSCR refinance than designer fixtures.
On 2-4 unit properties, separate meters, in-unit laundry and parking often support higher rents. Talk with a local property manager before finalizing the scope so the rent you underwrite matches what tenants in that area pay.
A complete package moves faster and gets better options. Our financing team reviews the scenario and typically comes back with 2-3 options for the bridge and a view of the likely DSCR exit.
Yes. Bridge loans start at $150,000, and larger balances are reviewed case by case. On bigger loans, leverage is often a step lower and reserve requirements are higher.
Bridge rates start at 7.99% for qualified borrowers. Larger balances are priced case by case based on the property, your experience and the leverage requested.
Bridge loans can close in as little as 10 days. On larger balances, title, insurance and any valuation review can add time, so start the file as early as you can.
The structure is similar, but the exit is different. A flip is repaid by a sale. This loan is repaid by a refinance into a long-term DSCR loan, so rent and appraised value matter most.
It depends on the program. Some allow a refinance on the new appraised value with little or no seasoning. Others cap the loan at your purchase price plus documented improvements for several months.
Yes. Duplexes, triplexes and fourplexes are common for this strategy. Properties with 5 or more units are financed through our multifamily programs instead.
Some bridge programs require no appraisal. On large balances, some programs may require an appraisal or a more detailed review. The DSCR refinance at the end will need its own appraisal.
No. LendingStreet finances non-owner-occupied investment property only. These loans are for properties you will rent to tenants.
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