Refinancing a Rental Property

[Kevin Hurley]

I have a rental property that I owned in Kansas City Missouri it’s fully rehabbed and I want to refinance it. When doing the refinance is there certain requirements that I have to meet and what are some other options to pull my money out

[Jon Holdman]

Debt coverage ratio is not used for a 1-4 unit residential property for a conventional loan. I assume that's what you want. Your personal DTI will be a factor. The rental income will only be counted if you have at least two years landlord experience. That is, rental income on two tax returns. Have a look at these Fannie Mae guidelines. Freddie Mac is similar, and these are what will apply to you, assuming you want a conventional loan. For a one unit property you can go up to 75% LTV for a cash out refi, 70% for 2-4 units. There's more info in that guide for DTI and cash reserves.

If this is a 5+ unit property then you are into commercial loan territory.  Debt coverage ratio does matter there.