Rental property?
Financing is the moat.
A great rental property with the wrong mortgage bleeds cash. The right lender, rental offset, and amortization structure can turn a break-even file into $400/mo positive. We route 1–4 unit rentals, BRRRR strategies, and 5+ unit commercial deals across A-lenders, credit unions, and alt-A programs.
- ✓ Rental offset structuring — 50% vs 75% vs 100% of gross rents
- ✓ Portfolio limits + DCR-based lenders when banks cap out
- ✓ BRRRR refi timing so you don't leave equity trapped
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20%
min down payment on 1–4 unit rentals
50%
of gross rent typically counted toward income by A-lenders
4+
unit buildings shift to commercial financing (different lender pool)
The Cash-Flow Math
$650k rental, $130k down, 4.29% fixed 30yr amort
Illustrative. Your actual cash-flow depends on rate, rent, and cost structure. What we do: model 3–5 lender scenarios so you know which lender + amortization combo maximizes cash-flow on YOUR file.
Where are you in the investor lifecycle?
The lender + product changes at each stage
First rental property (owner-occupied → new rental)
You're buying a second home and keeping the first as a rental. A-lender path: 20% down on the new principal, existing home refinanced as rental. Rental income offset typically 50% of gross rents.
Pure investment purchase (never lived in)
20% down minimum. Some lenders require 25% down. Rate premium of 25–50 bps over owner-occupied pricing. Purpose-declared as investment on the application.
BRRRR (Buy, Renovate, Rent, Refinance, Repeat)
Short-term acquisition financing (private / HELOC) → renovation → 6-month seasoning → refinance at improved appraised value up to 80% LTV. Broker helps sequence the lender at each step.
Portfolio purchase (3rd–5th property)
Most A-lenders cap at 4–5 doors per borrower. Beyond that: alt-A + credit unions with portfolio programs. DCR (debt coverage ratio) becomes the governing metric, not TDS.
Multi-family 2–4 unit (residential zoning)
Still residential mortgage territory. Rental offset improves (75%+ of gross rents at some lenders). Larger down usually required (25–30%). Excellent cash-flow property class.
Multi-family 5+ units (commercial)
Different lender pool: credit unions, commercial monolines, CMHC-insured multifamily. Underwriting is on the PROPERTY's income (DCR 1.20+ typical), not personal income. We refer to a commercial specialist on files this size.
Questions you probably have
How much down do I need for a rental?+
Minimum 20% on 1-unit rentals. 25% typical on 2–4 unit. 25–30% on commercial (5+). CMHC insurance IS available for 2–4 unit owner-occupied with rental income (5% down min on 1-unit owner-occ, higher on 2–4), but pure investment property is always 20%+.
How is rental income counted toward my qualification?+
Depends on the lender. Standard A-lender: 50% of gross rents added to income. More generous A-lenders: 75%. B-lenders with rental programs: up to 100%. On existing rentals, most lenders will use 2 years of T1 general schedules to average the actual net rental income — which can be HIGHER or lower than the 50% add-back depending on your property.
What's the cap on properties before A-lenders stop lending?+
Most A-lenders: 4–5 doors (mortgages) per borrower. After that: portfolio lenders (Equitable, Home Capital, credit unions) that use DCR (debt coverage ratio) — the property's income covers its own debt at 1.10–1.20x. Personal income becomes less relevant, property fundamentals more so.
Can I use projected rent for a property I haven't bought yet?+
Yes — a "market rent letter" from an appraiser or property manager is standard. Lenders discount projected rent more aggressively than existing rent (often to 40% add-back), so real leases beat projections when possible.
BRRRR — how does the refi timing work?+
Standard cycle: (1) short-term acquisition financing — private, HELOC, or cash. (2) 4–8 weeks renovation. (3) 6-month seasoning at the improved value (lenders won't refi at post-reno value without seasoning). (4) Refinance at up to 80% LTV of appraised value with an A-lender. Getting the sequence wrong leaves equity trapped in the deal. That's where broker experience matters.
What about STR / Airbnb income?+
A-lenders won't use STR income. B-lenders will use documented STR bookings averaged over 12 months, discounted 50%. If STR is your model, plan the file with an alt-A or B-lender from day one — or hold as long-term rental for lender purposes and convert after close.
Do you help with commercial 5+ unit?+
Yes but we refer to a commercial specialist for the actual placement. We stay involved to coordinate the personal side (existing residential mortgages, personal DTI) and to run the numbers before you make an offer.
Related situations
Might also fit your file
BRRRR refinance
The step-4 refi in the BRRRR cycle — 6-month seasoning, 80% LTV, sequenced across A-lenders.
Open playbook →
Closing an investor pre-con
Different lender stack for investor pre-con closings — appraisal gap plans + rental income structuring.
Open playbook →
Portfolio limit hit?
A-lenders cap at 4–5 doors. Portfolio programs and DCR-based credit unions kick in beyond that.
Open playbook →
Financing is the moat.
Wrong lender = negative cash flow. Right lender = a real portfolio. Get your file reviewed before you make an offer.
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