question for lenders and brokers:
Nathan P TannerPro Member
New to Real Estate · Bay Area California · Member since 2022 · 34 posts · 16 votesquestion for lenders and brokers:
Most Popular Reply
Wesley PittmanBusiness Member
Real Estate Broker · Reno, NV · Member since 2015 · 116 posts · 48 votesHey Nathan,
One thing that bit me in the *** on a deal was the first time I tried to BRRR a 5+ plus unit building. Commercial lenders typically have seasoning periods—they don't love seeing the owner take out more debt than the acquisition amount within a short time after purchase.
If you're not confident that you have a conforming/DSCR lender who'll allow a cash-out refi after you lease it, make sure you find one before you pull the trigger on the take down. In our case, with the 6 unit apartment building we ended up losing about $100,000 because the market softened substantially (this was 2022) and the commercial lenders required a 1.3 DSCR while rates were rising so the amount of equity we had to leave in the deal to cash out our bridge financing was just way too high to make sense... so we just sold it and licked our wounds.
Have you connected with Vontive? They've been taking a lot of market share lately and seem to have pretty flexible terms. They might be fine with a corporatew tenant. In the next few weeks here I'll be placing a tenant who sublets the unit for construction housing (think man camps), and I'll be doing a DSCR take-out with them and him as the tenant.
They may not even ask much about the lease agreement if it looks like a standard lease to an LLC.
TrueNest Properties566 Reviews
10 Replies
- 10moJaycee GreenePro MemberReal Estate Consultant · St. Louis MSA · Member since 2024 · 3k+ posts · 727 votes
Quote from @Nathan P Tanner:
Hey everyone, I’m in the process of acquiring several single-family homes that will be leased long-term to a sober living company. My plan is to buy properties needing medium to heavy rehabs, remodel them, rent, refi, and hold long-term. So far I have a location and buy box from the company that will be renting my properties long term, they will sign 5-7 year lease. I finally found a property that will cashflow, im in the middle of getting multiple quotes for the rehab work that needs to be done.
I had a question for lenders and brokers:
Do I need to prioritize using a local lender?If a lender isn’t local, what are the best ways to vet them to make sure they're reliable and a good fit for long-term partnership? I'm looking to build a solid relationship with someone who understands the BRRRR-style model and is comfortable working with this type of tenant setup (sober living, structured housing).
Appreciate any insights or recommendations, especially from those who’ve built strong lender relationships over multiple deals. I just want to make sure I’m setting things up right and avoiding major issues down the road.
Hey @Nathan P Tanner! Have you talked with ANY lenders yet?
- New to Real Estate · Bay Area California · Member since 2022 · 34 posts · 16 votes10mo
I've talked to a few just networking and learning more. Most all lenders Ive spoken to with was about 3 months back. Now the deals have became serious and I actually found a property worth my attention
- 10moJaycee GreenePro MemberReal Estate Consultant · St. Louis MSA · Member since 2024 · 3k+ posts · 727 votes
Quote from @Nathan P Tanner:
I've talked to a few just networking and learning more. Most all lenders Ive spoken to with was about 3 months back. Now the deals have became serious and I actually found a property worth my attention
@Nathan P Tanner In my opinion, the lender (or bank) will be more concerned with the sober living company you're partnering with...also, you may check with the ICA Fund, a CDFI lender in the Bay Area.
- 10moErik EstradaBusiness MemberLender · Member since 2022 · 6k+ posts · 1k+ votes
Quote from @Nathan P Tanner:
Hey everyone, I’m in the process of acquiring several single-family homes that will be leased long-term to a sober living company. My plan is to buy properties needing medium to heavy rehabs, remodel them, rent, refi, and hold long-term. So far I have a location and buy box from the company that will be renting my properties long term, they will sign 5-7 year lease. I finally found a property that will cashflow, im in the middle of getting multiple quotes for the rehab work that needs to be done.
I had a question for lenders and brokers:
Do I need to prioritize using a local lender?If a lender isn’t local, what are the best ways to vet them to make sure they're reliable and a good fit for long-term partnership? I'm looking to build a solid relationship with someone who understands the BRRRR-style model and is comfortable working with this type of tenant setup (sober living, structured housing).
Appreciate any insights or recommendations, especially from those who’ve built strong lender relationships over multiple deals. I just want to make sure I’m setting things up right and avoiding major issues down the road.
The fact that it will be used as a sober living facility will turn off a majority of traditional DSCR and Fix and Flip Lenders. You may need to look for a specialized bank for optimal terms. There are commercial 30 year fixed style lenders that can finance these on long term loans, however the property will need to be fully rehabbed and the rate will be considerably high (8-9%)
LuxePrivate Investments LLC 572 Reviews - 10moWesley PittmanBusiness MemberReal Estate Broker · Reno, NV · Member since 2015 · 116 posts · 48 votes
Hey Nathan,
One thing that bit me in the *** on a deal was the first time I tried to BRRR a 5+ plus unit building. Commercial lenders typically have seasoning periods—they don't love seeing the owner take out more debt than the acquisition amount within a short time after purchase.
If you're not confident that you have a conforming/DSCR lender who'll allow a cash-out refi after you lease it, make sure you find one before you pull the trigger on the take down. In our case, with the 6 unit apartment building we ended up losing about $100,000 because the market softened substantially (this was 2022) and the commercial lenders required a 1.3 DSCR while rates were rising so the amount of equity we had to leave in the deal to cash out our bridge financing was just way too high to make sense... so we just sold it and licked our wounds.
Have you connected with Vontive? They've been taking a lot of market share lately and seem to have pretty flexible terms. They might be fine with a corporatew tenant. In the next few weeks here I'll be placing a tenant who sublets the unit for construction housing (think man camps), and I'll be doing a DSCR take-out with them and him as the tenant.
They may not even ask much about the lease agreement if it looks like a standard lease to an LLC.TrueNest Properties566 Reviews - Investor · Augusta · Member since 2024 · 28 posts · 23 votes10mo
Hey Nathan,
You’re approaching this the right way by planning ahead on both the acquisition and long-term financing side. At the end of the day, once you’ve got stabilized SFRs with leases in place and can show consistent rent collection, you’ll be well-positioned to refinance each property individually and complete your BRRRR strategy.
As for your question about prioritizing a local lender — it really depends.
Local lenders can sometimes be private lenders who’ll help fund the purchase and renovation phase, but they typically don’t offer long-term loans. Some community banks may, but they’ll often structure them as commercial loans with balloon payments (3, 5, 7, or 10 years), meaning you’d have to refinance or pay them off down the road.That’s why I usually recommend that after the rehab and lease-up, you look toward individual DSCR 30-year fixed loans. Those will give you true long-term stability with minimal refinance risk — and you can shop around nationally for the best rates and lowest fees, rather than limiting yourself to local options.
The key is working with a lender or broker who’ll stay with you through each phase — acquisition, rehab, and long-term hold — and understands how to navigate structured or corporate tenancy setups like sober living.
If you’d like, I can share a few approaches we’ve used with investors doing multi-property BRRRRs under similar arrangements.
- Lender · Charleston, SC · Member since 2025 · 35 posts · 4 votes10mo
What's your timeframe to complete the rehab? Have options that would work for this.
- Real Estate Agent · San Jose, CA · Member since 2023 · 182 posts · 104 votes10mo
Quote from @Nathan P Tanner:
Hey everyone, I’m in the process of acquiring several single-family homes that will be leased long-term to a sober living company. My plan is to buy properties needing medium to heavy rehabs, remodel them, rent, refi, and hold long-term. So far I have a location and buy box from the company that will be renting my properties long term, they will sign 5-7 year lease. I finally found a property that will cashflow, im in the middle of getting multiple quotes for the rehab work that needs to be done.
I had a question for lenders and brokers:
Do I need to prioritize using a local lender?If a lender isn’t local, what are the best ways to vet them to make sure they're reliable and a good fit for long-term partnership? I'm looking to build a solid relationship with someone who understands the BRRRR-style model and is comfortable working with this type of tenant setup (sober living, structured housing).
Appreciate any insights or recommendations, especially from those who’ve built strong lender relationships over multiple deals. I just want to make sure I’m setting things up right and avoiding major issues down the road.
Hi Nathan. I am not an expert on the sober living space, but I do have a few lenders that I can recommend for BRRRR and non-traditional loans. I'll DM you.
- New to Real Estate · Miami, FL · Member since 2024 · 1k+ posts · 451 votes9mo
Hey Nathan,
Local isn't a must, what matters is a lender who understands BRRRR and is comfortable with sober living leases. Vet by asking about their rehab funding process, refi terms, and experience with similar deals. Reviews and responsiveness are key.
Happy to help you on your rei journey, feel free to reach out anytime! - Member since 2026 · 1 post · 0 votes8mo
@Nathan P Tanner Did you execute on this or find a direct lender who would lend based on the sober living? I have a client who purchased, rehabbed, and the property is being used for sober living with full occupancy. He is looking to do a rate/term refi and include closing costs which would push the loan to around 80% LTV. Searching for the right lender.
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