Real Estate Investor Financing FAQs
What States Do you Lend in?
Ei8ht Street Funding is able to lend to most states in the U.S. with the exception of Alaska, Nevada, North Dakota, South Dakota, MN AZ-(Some restrictions apply to CA)
Who do I contact for basic inquiries?
If you are a current client, please contact your loan officer directly with any questions. If you are a new client, you can contact us by phone at : 347 450 3712 or by email: submission@ei8htstreetfunding.com
Can I use this loan to buy my primary residence?
Ei8ht Street Funding is a commercial lender meaning our loans are used for business purposes, rather than individual or personal interests. We do not provide funding for the purchase of any owner occupied residential properties. Our loans are strictly backed by non-owner occupied residential and commercial properties, and are issued to a business entity
DSCR & Rental Property Loans
What is a DSCR loan?
A DSCR loan is an investment-property mortgage that primarily qualifies the borrower based on the property’s rental income rather than the borrower’s personal income. DSCR stands for Debt Service Coverage Ratio and compares the property's qualifying rental income to its monthly housing expense. These loans are commonly used by real estate investors because they typically do not require personal tax returns, W-2s, or traditional debt-to-income qualification.
How does a DSCR loan work?
A DSCR loan evaluates whether the rental income generated by an investment property is sufficient to cover the monthly mortgage-related expenses. The lender reviews the property value, market rent or lease income, credit profile, reserves, and DSCR rather than relying primarily on the borrower’s personal employment income.
What credit score do I need for a DSCR loan?
Ei8ht Street Funding currently offers DSCR programs beginning at a 660 FICO score. Borrowers with scores between 660 and 679 generally require a minimum 1.15 DSCR, while borrowers with a 680 or higher score may qualify with a 1.00 DSCR. We may also have non-DSCR rental loan options available for borrowers with credit scores below 660, including certain programs that can accommodate significantly lower credit scores at higher pricing.
All loans are subject to underwriting and final approval.
What DSCR do lenders require?
Requirements vary by lender and borrower profile. Under current Ei8ht Street Funding guidelines:
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680+ FICO: Minimum 1.00 DSCR
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660–679 FICO: Minimum 1.15 DSCR
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Foreign Nationals: Minimum 1.30 DSCR
Additional factors such as property type, loan-to-value, liquidity, and credit history may also affect eligibility.
Can I qualify for a DSCR loan without tax returns?
Yes. DSCR loans are designed for real estate investors and generally do not require personal tax returns, W-2s, pay stubs, or traditional debt-to-income calculations. Qualification is primarily based on the property’s rental income, the borrower’s credit profile, reserves, and the overall strength of the transaction.
Can I qualify for an investment-property loan based on rental income?
Yes. With a DSCR loan, the property’s qualifying rental income is used to help determine eligibility. Depending on the transaction, lenders may use an existing lease, appraisal market-rent schedule, or other approved rental-income documentation.
Can I get a DSCR loan with bad credit?
Potentially. Standard Ei8ht Street Funding DSCR programs currently begin at a 660 FICO score, but alternative rental-loan programs may be available for borrowers with lower credit scores(500+). Lower-credit programs may require higher rates, lower leverage, stronger reserves, or other compensating factors.
Can I get a DSCR loan with no income verification?
Yes. DSCR loans generally do not verify personal employment income in the same way as conventional mortgages. Instead, qualification focuses on the investment property’s rental income, credit, reserves, property value, and loan structure.
Can a first-time investor get a DSCR loan?
Yes. First-time investors may qualify for a DSCR loan. Experience can strengthen a loan application, but prior real estate investment experience is not always required.
What is the maximum LTV on a DSCR loan?
For eligible 1–4 unit rental properties, Ei8ht Street Funding currently offers up to:
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80% LTV on purchases
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80% LTV on rate-and-term refinances
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75% LTV on cash-out refinances
Maximum leverage may vary based on credit score, DSCR, property type, occupancy, loan size, and borrower profile.
How much down payment do I need for an investment property?
If a transaction qualifies for 80% LTV financing, the borrower would generally need approximately 20% toward the purchase price, plus applicable closing costs and required reserves. Some transactions may require a larger equity contribution depending on credit, DSCR, property type, or other underwriting factors.
How much can I borrow with a DSCR loan?
Ei8ht Street Funding offers rental-property financing starting at $75,000, with eligible long-term rental loans available up to $5 million, depending on the property type and transaction.
Can I use Airbnb or short-term rental income to qualify?
Yes. Eligible short-term rental properties may qualify. Under current guidelines, qualifying income for certain short-term rental properties may be calculated using 80% of supported AirDNA income. Beach and mountain short-term rental properties may also be eligible, subject to underwriting.
How much equity can I cash out of a rental property?
For eligible 1–4 unit rental properties, Ei8ht Street Funding currently allows cash-out refinances up to 75% LTV, subject to seasoning requirements, appraisal value, credit, DSCR, and underwriting.
How does a cash-out refinance work on an investment property?
A cash-out refinance replaces the existing mortgage with a new, larger loan. After paying off the existing mortgage and applicable closing costs, the borrower receives the remaining eligible proceeds. Investors often use cash-out proceeds to purchase additional properties, fund renovations, create liquidity, or deploy capital into other investments.
Can an LLC qualify for a mortgage?
Yes. Investment-property loans are commonly made to LLCs and other eligible business entities. The individual owners or guarantors are generally reviewed as part of underwriting.
Can foreign nationals get investment-property loans in the U.S.?
Yes. Ei8ht Street Funding offers financing options for eligible foreign national real estate investors. Current DSCR guidelines generally require a 1.30 DSCR for foreign nationals. Foreign nationals residing in the United States who have an eligible U.S. credit score may be underwritten based on that score without the traditional foreign-national LTV reduction in certain situations.
Can I buy an investment property without being a U.S. citizen?
Yes. Eligible permanent residents, certain non-permanent residents, and foreign nationals may qualify for investment-property financing. Documentation requirements depend on residency status, visa status, credit profile, and loan program.
Fix & Flip Financing FAQs
How much money do I need to flip a house?
The amount of cash required depends on the purchase price, renovation budget, borrower experience, and financing structure. Ei8ht Street Funding offers fix-and-flip programs that can finance a significant portion of both the purchase and renovation costs. Highly experienced investors who meet specific requirements may qualify for programs offering up to 100% of the purchase price and 100% of eligible renovation costs. Borrowers should still expect to have funds available for closing costs, reserves, contingencies, and other transaction expenses.
Can I get 100% financing for a fix and flip?
Potentially. Under current Ei8ht Street Funding guidelines, qualifying experienced investors may be eligible for 100% purchase financing plus 100% of eligible renovation costs.
Current requirements for the 100% financing program include:
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Minimum 720 FICO
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At least 10 completed flips within the previous 36 months
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At least 5 completed flips in the same state
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Maximum loan amount of $800,000
Additional underwriting requirements apply.
Do I need experience to get a fix-and-flip loan?
Not necessarily. Ei8ht Street Funding offers fix-and-flip financing for investors without prior rehab experience. However, experience can significantly improve leverage. For example, more experienced investors may qualify for higher loan-to-cost financing, and the 100% financing program has specific experience requirements.
What credit score do I need for a fix-and-flip loan?
Ei8ht Street Funding’s current fix-and-flip guidelines generally allow financing beginning at approximately a 650 FICO score, subject to the overall transaction and borrower profile. The 100% financing program requires a minimum 720 FICO.
Does a fix-and-flip lender finance renovation costs?
Yes. Eligible renovation costs can be included in the loan. Rehab funds are typically held back and released through construction draws as work is completed.
Can I finance the purchase price and renovation costs?
Yes. Fix-and-flip financing can include both the acquisition cost and eligible renovation expenses. The amount financed depends on borrower experience, loan-to-cost, after-repair value, credit profile, and the overall transaction.
What is ARV in real estate?
ARV stands for After Repair Value. It is the estimated market value of a property after the proposed renovation has been completed. Fix-and-flip lenders use ARV to help determine maximum loan proceeds and evaluate whether the project has sufficient equity and profit potential.
How do rehab draws work?
Renovation funds are generally held in a construction escrow and released in stages as work is completed. The borrower completes an agreed-upon portion of the project, requests a draw, and the completed work is typically inspected or verified before funds are released. Ei8ht Street Funding does not charge interest on undisbursed rehab funds until those funds are actually advanced.(Smaller loans maybe subject to full note interest)
Can I refinance a fix-and-flip loan instead of selling the property?
Yes. Investors who decide to hold a renovated property may potentially refinance the short-term fix-and-flip loan into a long-term rental or DSCR loan. This is commonly used as part of the BRRRR strategy: Buy, Rehab, Rent, Refinance, Repeat.
BRRRR & Investor Refinance FAQs
What is the BRRRR strategy?
BRRRR stands for:
Buy – Rehab – Rent – Refinance – Repeat
An investor purchases a property, renovates it, rents it to a tenant, refinances the property based on its stabilized value and rental income, and then uses the recovered capital toward another investment.
How do I finance a BRRRR property?
A common BRRRR financing structure uses a short-term fix-and-flip or rehab loan to purchase and renovate the property. Once construction is completed and the property is rent-ready, the investor may refinance into a long-term DSCR rental loan. Ei8ht Street Funding can fund both transactions.
Can I refinance a fix-and-flip loan into a 30-year rental loan?
Yes. Investors can potentially refinance a completed fix-and-flip project into a 30-year fixed DSCR rental loan, provided the property and borrower meet the rental-loan underwriting requirements.
How soon can I refinance after renovating a property?
Timing depends on how the property was acquired and the loan program being used.
Current Ei8ht Street Funding guidelines generally require:
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3 months of mortgage seasoning for certain financed purchases
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6 months of seasoning for certain properties purchased with cash
The exact refinance structure should be reviewed before acquisition whenever possible.
Investment Property Financing FAQs
What is a hard-money loan?
A hard-money loan is generally a short-term real estate loan secured primarily by investment property. These loans are often used for fix-and-flip projects, renovation properties, bridge financing, and transactions that may not fit traditional bank underwriting.Hard-money and private-lending programs typically prioritize the property, equity, project economics, and exit strategy.
What is the difference between a hard-money loan and a DSCR loan?
A hard-money loan is generally designed for short-term investment projects such as fix-and-flip or renovation transactions. A DSCR loan is generally designed for stabilized rental properties and typically provides long-term financing based primarily on rental income. An investor might therefore use a hard-money or fix-and-flip loan to acquire and renovate a property, then refinance into a DSCR loan once the property is completed and rented.
How do I buy my first investment property?
Most first-time investors begin by identifying their financing capacity before making an offer.A lender will typically review the proposed purchase price, property type, expected rent, credit profile, available liquidity, and planned investment strategy.
Knowing how much financing is available before shopping for properties can make it easier to evaluate deals and submit realistic offers.
How much money do I need to start investing in real estate?
There is no single amount required. The cash needed depends on the financing program, purchase price, property type, closing costs, and reserves.
For example, an investment property financed at 80% LTV would generally require approximately 20% toward the purchase price, in addition to closing costs and required reserves. Fix-and-flip financing may require substantially less of the purchase price from the borrower depending on experience and transaction strength.
Can I invest in real estate with little money down?
Yes, certain investment strategies and financing programs can reduce the amount of initial capital required. Experienced fix-and-flip investors may qualify for very high leverage, including eligible 100% financing programs. Rental-property investors may qualify for financing up to 80% of the purchase price. Higher leverage is subject to stricter underwriting requirements and does not eliminate the need for closing costs, reserves, and other transaction expenses.
Ground-Up Construction FAQs
How do I finance ground-up construction?
Ground-up construction loans provide short-term financing for eligible investors or builders constructing a new investment property.
The loan may include funding for the land or existing lot as well as eligible construction costs. Construction funds are generally released through draws as work progresses.
Can I finance the land and construction together?
Potentially, yes. A ground-up construction loan may be structured to finance both the acquisition of the land and eligible construction costs, depending on the transaction. We will evaluate the land value, construction budget, plans, permits, borrower experience, projected completed value, and required equity contribution.
Do I need construction experience to get a ground-up construction loan?
Experience requirements depend on the specific transaction and program.
Ei8ht Street Funding will typically review the borrower’s previous construction or real estate development experience, the general contractor’s qualifications, the scope of the project, and the strength of the proposed exit strategy.
How do construction draws work?
Construction proceeds are generally held in escrow and released as work is completed. After a stage of construction is completed, the borrower submits a draw request. The work is typically inspected or verified, and the approved portion of the construction funds is then released.
Do I need Builder's Risk insurance?
Yes. Ground-up construction projects typically require an acceptable Builder’s Risk insurance policy during the construction period. The required coverage must meet lender guidelines and remain in effect throughout the applicable construction phase.
Can I refinance a construction loan into a DSCR loan?
Yes. Once construction is complete and the property qualifies as a stabilized rental property, the borrower may potentially refinance the construction loan into a long-term DSCR mortgage. This can allow the investor to transition from short-term construction financing into a 30-year rental-property loan.
Rental Property Analysis FAQs
How do I know if a rental property is a good deal?
Investors typically evaluate several measurements rather than relying on a single number.
Important factors include:
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Purchase price
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Market rent
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Mortgage payment
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Property taxes
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Insurance
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Maintenance
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Vacancy allowance
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Property management
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Capital expenditures
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Net operating income
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DSCR
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Cash flow
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Cash-on-cash return
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Potential appreciation
A property that generates positive cash flow while maintaining adequate reserves and a sustainable DSCR is generally stronger than one that depends entirely on future appreciation.
What is a good cap rate for a rental property?
There is no universal “good” cap rate because cap rates vary significantly by property type, market, neighborhood, condition, and investment risk.
Cap rate is calculated as: Net Operating Income ÷ Property Value
Investors should compare the property's cap rate to similar properties in the same market rather than relying on a nationwide benchmark.
What is a good cash-on-cash return?
Cash-on-cash return measures the annual cash flow produced by a property relative to the investor's actual cash invested. It is calculated as: Annual Pre-Tax Cash Flow ÷ Total Cash Invested. The appropriate target varies based on market conditions, financing costs, property type, investor strategy, and risk tolerance.
How do I calculate cash flow on a rental property?
A simple calculation is: Monthly Rental Income – Monthly Property Expenses = Monthly Cash Flow. Expenses may include the mortgage payment, property taxes, insurance, property management, repairs, maintenance, utilities paid by the owner, HOA fees, vacancy allowance, and other operating expenses.
How much profit should a rental property make per month?
There is no universal minimum amount. A property's profitability should be evaluated relative to the amount of cash invested, financing terms, market rents, reserves, property condition, and anticipated expenses. Investors should focus on sustainable cash flow and overall return rather than relying only on a fixed monthly dollar amount.
What is the 1% rule in real estate?
The 1% rule is a quick screening method used by some rental-property investors. It suggests that monthly rent should equal approximately 1% of the property's purchase price. For example, a $200,000 property would ideally rent for approximately $2,000 per month under the rule. The 1% rule is only a preliminary screening tool. Taxes, insurance, financing costs, repairs, vacancy, and market conditions must still be evaluated.
Important: Program guidelines, interest rates, leverage, and eligibility requirements are subject to change. All loans are subject to underwriting review and approval. Ei8ht Street Funding finances investment properties only.