Refinancing a BRRRRR

Kingston, New York
Private Lending & Conventional Mortgage Advice
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Refinancing a BRRRRR

Carlos PelegrinaPro Member
Investor · New York City, NY · Member since 2017 · 118 posts · 32 votes

Hi Guys. I am finishing a three-apartment unit renovation, and I am starting to look for a lender to refinance it long-term.
Any suggestions for companies you had a good experience with? Can be brokers, banks, etc.? Are there any lenders charging less than 7%? I would appreciate any help and guidance on this.

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James Loffredo
Lender · Dallas, TX · Member since 2024 · 10 posts · 3 votes
17h

Carlos, congrats on getting to the finish line! A few things will move your rate more than which lender you pick:

  • Get it leased before the appraisal. Empty units only count at about 100% of market rent on a refi and not your lease

  • Decide rate and term or cash out before you shop. Cash out usually means 75% instead of 80% and a little more rate

  • 720+ gets the best pricing

  • If you’re holding long term, a longer prepay usually buys you a lower rate

Most programs want you on title about 3 months before they’ll lend off the new value. Get every quote with rate, points and prepay together so you’re comparing the same thing.

I run a lender, so weigh that. Also, im partial to DSCR

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  • James Loffredo
    Lender · Dallas, TX · Member since 2024 · 10 posts · 3 votes
    17h

    Carlos, congrats on getting to the finish line! A few things will move your rate more than which lender you pick:

    • Get it leased before the appraisal. Empty units only count at about 100% of market rent on a refi and not your lease

    • Decide rate and term or cash out before you shop. Cash out usually means 75% instead of 80% and a little more rate

    • 720+ gets the best pricing

    • If you’re holding long term, a longer prepay usually buys you a lower rate

    Most programs want you on title about 3 months before they’ll lend off the new value. Get every quote with rate, points and prepay together so you’re comparing the same thing.

    I run a lender, so weigh that. Also, im partial to DSCR

    1Reply
  • Ryan BrownPro Member
    Real Estate Agent · Louisville, KY · Member since 2022 · 27 posts · 3 votes
    17h

    We’re always interested in building strong relationships with local banks and lenders. We’ve found that having a direct line to someone who knows the market and can take a practical look at a deal makes a big difference. Local lenders tend to be easier to work with and have more flexibility, so those are the relationships we really value.

    [email protected]502-889-0122
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  • Tyler MccleanPro Member
    Investor · Nassau County, NY · Member since 2022 · 92 posts · 25 votes
    16h

    Hey Carlos, yes if you have excellent credit and the DSCR > 1.25 you should be able to get slightly below 7% with a 5 year prepay. Rates are super tough right now unfortunately. Shoot me a DM I can go over your scenario and let you know what you can get in a few minutes!

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  • AJ ExnerPro Member
    Lender · Springfield, MO · Member since 2023 · 660 posts · 319 votes
    16h

    Hey Carlos,

    So if you use the "Find Agents & Lenders" tab at the top and fill in what you need, Bigger Pockets will actually curate a list of approved lenders in your area that can help.

    I've even used it for a Property Management need that I had, it tends to work pretty well

    Good luck!

    [email protected]417-427-2612
    0Reply
  • Corey Holbert
    Lender · Newport Beach, CA · Member since 2026 · 4 posts · 0 votes
    16h

    Finding an investment property rate under 7% is currently difficult without paying significant discount points.

    Non-owner-occupied multi-family loans typically carry a distinct premium over standard residential rates.

    To secure the best possible terms, you should explore three primary avenues that I’m happy to go over with you.

    Local banks, DSCR and LTV Trade offs.

    I’m a commercial loan broker so we help short cut the shopping process with lenders that moving quick and provide great options.

    0Reply
  • Corey Holbert
    Lender · Newport Beach, CA · Member since 2026 · 4 posts · 0 votes
    16h

    Finding an investment property rate under 7% is currently difficult without paying significant discount points. Non-owner-occupied multi-family loans typically carry a distinct premium over standard residential rates. To secure the best possible terms, you should explore these primary avenues:

    Local bank, DSCR or LTV trade offs. I'm happy to go over some options with you.

    0Reply
  • Corey Holbert
    Lender · Newport Beach, CA · Member since 2026 · 4 posts · 0 votes
    16h

    Finding an investment property rate under 7% is currently difficult without paying significant discount points. Non-owner-occupied multi-family loans typically carry a distinct premium over standard residential rates. To secure the best possible terms, you should explore these primary avenues:

    Local bank, DSCR or LTV trade offs. I'm happy to go over some options with you.

    0Reply
  • Corey Holbert
    Lender · Newport Beach, CA · Member since 2026 · 4 posts · 0 votes
    16h

    Finding an investment property rate under 7% is currently difficult without paying significant discount points. Non-owner-occupied multi-family loans typically carry a distinct premium over standard residential rates. To secure the best possible terms, you should explore these primary avenues:

    Local bank,

    0Reply
  • AJ ExnerPro Member
    Lender · Springfield, MO · Member since 2023 · 660 posts · 319 votes
    16h

    Also, how long ago did you purchase/begin the renovations? You might also run into seasoning requirements if you were able to turn it around relatively quickly

    [email protected]417-427-2612
    0Reply
  • Devin PetersonBusiness Member
    Lender · Sarasota, FL · Member since 2022 · 2k+ posts · 672 votes
    16h

    Congrats on getting close to the finish line. A few things that haven't come up yet:

    1. Since it's 3 units, a conventional (Fannie/Freddie) investment loan is worth pricing alongside DSCR. If your personal income and DTI support it, conventional on 2-4 units often prices below DSCR, but it needs full income docs, has lower max LTVs on 3-4 units (especially for cash-out), and counts toward the 10 financed-property limit.

    2. If you go DSCR, the levers for getting under 7% are credit, a lower LTV (70% or less usually prices best), a longer prepay, and paying points. Ask each lender for a quote with and without points so you can compare the breakeven.

    3. If you want cash out, ask every lender about seasoning up front. Rules vary a lot: some DSCR lenders use the new appraised value after 3-6 months on title, while others cap you at your cost basis until then. Conventional cash-out has its own seasoning requirements too.

    4. Get leases signed before the appraisal. On a 3-unit the appraiser completes a rent schedule, and most lenders use the lower of the actual leases or market rent.

    A local bank or credit union portfolio loan is also worth a call in the Hudson Valley, since some will beat DSCR pricing for a borrower with deposits there.

    [email protected]860-538-3672
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  • Christian Wamsley
    Investor · Augusta · Member since 2024 · 33 posts · 25 votes
    15h

    Carlos, congratulations on getting close to finishing your renovation!

    There are some good points already made here about rates, seasoning, and lender options. I'd like to add a different perspective.

    Before focusing on getting below 7%, my first question would be: What are you trying to achieve with this refinance?

    Are you looking to recover as much of your invested capital as possible to move into your next BRRRR project, or is your priority maximizing monthly cash flow while holding the property long-term?

    I ask because those two goals can lead to very different financing strategies.

    For example, lowering your LTV may improve your interest rate and monthly cash flow, but it also means leaving more capital in the property. The same goes for choosing a longer prepayment penalty to obtain better pricing. That may work well for someone planning to hold, but not necessarily someone who wants the flexibility to refinance again.

    I'd also want to understand your purchase price, renovation costs, expected appraised value, rental income, and how long you've owned the property. Those numbers will help determine which programs make the most sense.

    As a broker, I've learned that the best financing isn't always the lowest rate. It's the financing that supports what the investor is trying to accomplish.

    Once you know your goal, comparing lenders and their terms becomes much easier.

    —

    0Reply
  • Morgan Hondros
    Member since 2019 · 7 posts · 3 votes
    15h

    Carlos — congrats on getting it across the line. Good advice above already, especially getting leases signed before the appraisal and asking every lender about seasoning up front. Those two move your outcome more than which lender you pick.

    One thing I'd add on the under-7% question: on a 3-unit investment cash-out right now, a 6-handle usually means buying it down with points and accepting a longer prepay. Whether that's worth it comes down to how long you're holding. If this is a true BRRRR and you may pull capital or refinance again in a couple years, paying up front to shave the rate can cost you more than it saves — a par rate with a shorter prepay often nets out better. If you're keeping this one long term, buying down makes more sense.

    As a broker I can run your scenario across several DSCR options and price it against a conventional 3-unit on a single submission, so you see the real tradeoffs side by side instead of getting pulled apart by every lender separately. Happy to put honest numbers in front of you — send purchase price, rehab, expected value, rents, and time on title and I'll take a look.

    0Reply
  • Renard BrownPro Member
    Austin, TX · Member since 2026 · 52 posts · 6 votes
    15h

    @Carlos Pelegrina Happy to connect, DM sent.

    0Reply
  • Brandon Buhl
    Washington State · Member since 2026 · 20 posts · 2 votes
    14h

    Why This Response Drives Inbound DMs:

    0Reply
  • Brandon Buhl
    Washington State · Member since 2026 · 20 posts · 2 votes
    14h

    Why This Response Drives Inbound DMs:

    0Reply
  • Dan Duenas
    Lender · Member since 2026 · 41 posts · 23 votes
    14h

    Carlos — for a 3-unit BRRRR exit there are really two clean paths, and which one wins comes down to one question nobody's asked yet: are you pulling cash out for the next deal, or going rate/term to hold?

    If it's cash out: the lender's seasoning policy is the whole ballgame. Some DSCR lenders will lend on the new appraised value with no seasoning at all — others cap you at your cost basis or make you sit on title 3-6 months. Line that up BEFORE the appraisal gets ordered, because you don't get a second swing at the number.

    If it's rate/term to hold: under 7% is real, but it's a package deal — 720+ credit, lower LTV (think 70% or less), a longer prepay period, maybe buying it down with points. Anyone quoting you a rate without asking about your prepay term isn't giving you the full price.

    Either way, two freebies: get the leases signed before the appraiser shows up (they use the lower of your actual lease or market rent), and run one DSCR quote against one conventional quote — DSCR qualifies on the property's rent with zero personal-income paperwork, which is usually faster, but conventional can win on rate if your DTI and the 10-financed-property limit aren't an issue.

    Happy to run your numbers if you want a second set of eyes — Dan

    0Reply
  • Jiao Liu
    Lender · Houston, TX · Member since 2026 · 43 posts · 11 votes
    13h

    Hi Carlos — on the rate question, I'll be straight: sub-7% on a 3-unit refi does happen, but only when the numbers are strong — high credit, low LTV, and rents that carry the payment comfortably. Most files price above that, so anyone promising it before seeing your numbers isn't being straight with you.

    I can price yours properly if you send me:

    1. How much you're looking to borrow — and is there an existing loan to pay off? If so, roughly what's the balance?

    2. What do you estimate the property is worth now, with the renovation finishing?

    3. Monthly rent for each unit (or the total), and are all three leased?

    4. Your credit score range

    5. When does the renovation finish, and when did you buy the property?

    With those I can tell you where your rate would actually land instead of guessing.

    0Reply
  • Robin SimonBusiness Member
    Lender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
    12h

    Yup and one thing I would add is ask every lender upfront about seasoning, theres a big difference between lenders that will only refi off your purchase price + rehab costs until you've owned it 6-12 months vs ones that do "no seasoning" cash-out off the full appraised value, on a BRRRR thats usually the difference between getting all your capital back out or leaving a chunk in the deal. Sub-7% is doable on a 3-unit with DSCR but generally you'd need strong credit (720+), lower leverage (like 65-70% LTV vs maxing out), a 5 year prepay and sometimes paying a point to buy it down - if you're going for max cash-out at 75-80% LTV expect it to price higher. Are you trying to pull out as much cash as possible or is the rate the priority?

    [email protected]
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  • Zach Edelman
    Lender · New York, NY · Member since 2022 · 1k+ posts · 1k+ votes
    12h

    Hey Carlos, two things I’d ask any lender/broker you talk to:

    1. What's your rate floor? Most DSCR lenders cap how low you can buy down. I'm seeing floors anywhere from 6.750% to 7.125% right now, so sub-7% is doable with some but not others. Most of these scenarios are also rate-term refinances (rather than cash-out).

    2. Can you quote it both rate-term and cash-out? Depending on how much you’re pulling out and how long you’ve owned it, one may price meaningfully better (i.e get you a rate below 7.000%).

    1Reply
  • Brandon Buhl
    Washington State · Member since 2026 · 20 posts · 2 votes
    11h

    Carlos Pelegrina — Congrats on getting the 3-unit renovation across the finish line! Moving from the rehab/bridge stage into long-term debt is where the BRRRR strategy either locks in solid long-term equity or runs into cash-flow friction.

    To answer your question directly regarding sub-7% interest rates:

    In today’s rate environment, non-bank DSCR (Debt Service Coverage Ratio) loans for a 3-unit residential property generally price in the 6.75% to 7.50%+ range, depending primarily on four structural variables:

    1. Credit Tier (FICO): Unlocking sub-7% pricing sheets usually requires a 720–740+ FICO score.

    2. LTV Target: Keeping your Cash-Out Refinance capped at 65%–70% LTV yields significantly better rate brackets than pushing to 75% or 80%.

    3. DSCR Ratio: When your post-rehab gross rental income covers the proposed new debt service at 1.25x or higher, lenders unlock their top-tier rate brackets.

    4. Prepayment Penalty Structure: Selecting a 3-year or 5-year step-down prepay (e.g., 5/4/3/2/1 or 3/2/1) drops your base interest rate compared to a zero-prepay option.

    3 Strategic Pathways to Secure Sub-7% Pricing Right Now:

    • Pathway A: Rate Buydowns (Discount Points): Paying 1.0 to 1.75 discount points at closing lets you permanently lower a 30-year fixed DSCR rate into the mid-6s. On a long-term hold, calculating the breakeven period on points vs. monthly cash flow usually makes total sense.

    • Pathway B: Hybrid ARMs (5/1 or 7/1): Non-bank hybrid ARMs currently price 25 to 50 basis points lower than 30-year fixed DSCR products, putting sub-7% well within reach if you plan to hold or re-evaluate the asset in 5–7 years.

    • Pathway C: Local Community Portfolio Banks: Regional banks in the property's sub-market occasionally hold debt around 6.50%–7.00%. However, keep in mind they will require full tax returns, global cash-flow underwriting, personal DTI verification, and depository relationships.

    Underwriting Pro Tip for 2–4 Unit Refinances: Make sure your appraiser uses verified, comparable multi-family market rents on Form 1007 rather than single-family comps so your DSCR coverage calculation isn't artificially penalized.

    📩 If you want to run your 3-unit rental numbers through a quick capital stack stress-test or check where your LTV sits on a cash-out, feel free to send me a Direct Message! Always glad to help run the numbers.

    0Reply
  • Erik EstradaBusiness Member
    Lender · Member since 2022 · 6k+ posts · 1k+ votes
    11h

    Hey Carlos,

    7% is basically the norm for par rate pricing on DSCR Loans, investment in general. You have to pay some buy down points and it will be very costly to get under 7.

    It's just the market.

    [email protected]818-269-7983
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  • Konlaa Bright
    Member since 2025 · 2 posts · 0 votes
    10m

    Hey Carlos, congrats on finishing the three-unit renovation — that's no small feat! How's the BRRRR going overall, happy with how the numbers worked out?

    I'm not a lender myself, but I work with a few people in the private/hard money space who also handle DSCR refinances for investors — happy to ask around and see if any of them could offer something competitive if you're open to it.

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