What Financing Strategies Are Investors Using in 2026?

Question

I'm seeing a lot of investors gearing up for acquisitions this summer.

If you're actively looking at rentals, BRRRRs, fix & flips, or new construction projects, what type of financing are you using most often?

Happy to share what I'm seeing in the investor lending space and answer any questions if it helps.

Garrett Crosby · Answer

From the investor side, the most common thing I'm seeing right now is a combination of DSCR loans for buy-and-hold acquisitions and hard money or bridge loans to fund the initial purchase and rehab on flips or BRRRRs before refinancing into long-term debt.

Seller financing is also having a bit of a moment right now, especially in markets where sellers have low-rate mortgages and buyers are rate-sensitive. If the seller is willing, a subject-to or a wrap can make deals pencil that wouldn't otherwise. Not always easy to find but worth asking about when you're in negotiation.

Conventional is still the move for house hackers and owner-occupants, of course. The rate environment hasn't killed the strategy, it's just forced more discipline on the buy side. Feel free to DM if you want to talk through what works for a specific deal type.

Mike Klarman · Answer

What you see will never change.

There's the investors chasing the distressed that need rehab, the BRRRR or a flip.  That's a short term position with heavy execution risk.  Most try to break in this way because it teases the investor to get their money back at the refi table or a sale all within 6 - 9 months.  Most young investors think to execute all this is just a given and it is anything but.  You really need to know what you are doing, and have the appropriate amount of capital.  The investment product for this investment is what it is, sliding scale of leverage from 75% - 90% in most cases with a sliding scale of rate from 9.99% - 12%.  No PPP, interest only payments, 1 - 2 points origination.  I don't know if that product will ever change, hundreds of thousands use it.

There's some that choose to buy turnkey and they are usually the clients with deeper capital access.  They can put 120k into an asset and wait to get their appreciation and cash back.  DSCR purchases offer 80% leverage and the rate right now is mid 6s if you know where to go all the way up to mid 7s.

Then theres the rate/term or cash out refis, people who need to get out of a short term loan and into a long term with a lower rate or someone who has equity to tap, 70% - 75% DSCR, up to 80% on the rate term.

There is a Private Money side to the coin that most never get to tap into and most think it is the missing piece and it is not.  The missing piece is the know how on sourcing and the know how on team building.

Stacy Raskin · Answer

I'm seeing investors use DSCR loans to start with or beginning with a fix and flip loan and converting the financing to long term financing with a DSCR loan after the property has been remodeled. Investors like the programs as there's no personal income qualifications or debt to income (DTI) ratios which allows investors to scale while finding deals that are income producing or will be income producing after a property rehab. If the investor has the credit score and down payment, those are the main items needed for the loan programs.