No seasoning DSCR
Tallahassee, FL · Member since 2026 · 4 posts · 1 vote
No seasoning DSCR
11 Replies
- 1wErik EstradaBusiness MemberLender · Member since 2022 · 6k+ posts · 1k+ votes
There are some lenders that will use the new appraised value without any cash out restrictions. The drawback will be the higher rate.
LuxePrivate Investments LLC 572 Reviews - 1wMatt HiltnerPro MemberLender · Denver, CO · Member since 2021 · 41 posts · 11 votes
@James Dunn How long have you owned the property and what is your plan with it when it's done? I assume since you mention DSCR, you're planning on keeping it as a rental but if that's not the case you may have other options. I can do DSCR after 3 months of seasoning. We do offer a "Stabilized Property" bridge which would allow you to refi now on a 12-24 month basis, pull out cash now to grab that next opportunity. That option is faster than a DSCR as well.
Happy to discuss further and see if we can find a solution.- Tallahassee, FL · Member since 2026 · 4 posts · 1 vote1w
I'm only three weeks into this property but renovations are flying through. Shooting to put it up for rent on the 1st, so looking at the next opportunity.
- Attorney · 10451 Mill Run Cir #755 Owings Mills, MD 21117 · Member since 2024 · 302 posts · 113 votes1w
Quote from @James Dunn:
I'm wrapping up a rehab project and found something I'm interested in however my funds are tied up in the correct project. Do all DSCR loans with no seasoning requirement lend on the purchase price vs a new appraised value?
@James Dunn, one thing I’ve learned from working with investors is that I would look at more than just how much cash the refinance lets you pull out. I’ve seen people solve the immediate problem of freeing up capital, but then realize the new loan left the first property much tighter than they expected. Before moving forward, I would want to understand the rate, payment, prepayment terms, reserves, and what the property actually cash flows after the new debt is in place.
I would also make sure the title, insurance, and ownership structure are clean before refinancing, especially if the property was just rehabbed or is being moved into an LLC. Getting money back out is great, but I would not want the next opportunity to make the current property less stable. I like that you are thinking about your next deal while finishing this one, and I'd be glad to stay connected and see how you structure it.
- Tallahassee, FL · Member since 2026 · 4 posts · 1 vote1w
Quote from @Diana Khan:
Quote from @James Dunn:
I'm wrapping up a rehab project and found something I'm interested in however my funds are tied up in the correct project. Do all DSCR loans with no seasoning requirement lend on the purchase price vs a new appraised value?
@James Dunn, one thing I’ve learned from working with investors is that I would look at more than just how much cash the refinance lets you pull out. I’ve seen people solve the immediate problem of freeing up capital, but then realize the new loan left the first property much tighter than they expected. Before moving forward, I would want to understand the rate, payment, prepayment terms, reserves, and what the property actually cash flows after the new debt is in place.
I would also make sure the title, insurance, and ownership structure are clean before refinancing, especially if the property was just rehabbed or is being moved into an LLC. Getting money back out is great, but I would not want the next opportunity to make the current property less stable. I like that you are thinking about your next deal while finishing this one, and I'd be glad to stay connected and see how you structure it.
I've got a pretty good understanding of what the property "should" cash flow given it was an all cash purchase, the rehab cost, and the anticipated loan amount. Of course the rate matters however unless it's awful it shouldn't affect things much. I purchased it into the LLC so also not a problem, I'm pretty confident on the rents in the area and the recent sales give me a pretty good understanding of what it should appraise at. I in no way plan on pulling out every penny, just enough to pull my money out and leave it well below what the rents are so it cash flows.
If you think I've missed something, please let me know.
- 1wStacy RaskinBusiness MemberLender · Member since 2022 · 1k+ posts · 494 votes
For DSCR programs that will lend on the appraised value with no seasoning depends on the details. There are no seasoning cash out options if you have a loan on the property currently and also if the new loan amount will be over at least a $100K. If not, there is seasoning depending on the loan program. Happy to connect to discuss further.
Bright Skyline518 Reviews - 1wRay WilliamsBusiness MemberLender · Denver, CO · Member since 2017 · 148 posts · 68 votes
James, worth breaking apart two different things that are getting blended together in this thread. Seasoning and appraised-value eligibility are not quite the same lever. Most no-seasoning DSCR cash-out programs will still cap your loan amount at your documented cost basis, meaning purchase price plus any rehab you can show with receipts and a paid invoice trail, rather than the fresh appraised value, if you're under the standard six month seasoning mark. That protects the lender against a same-day flip-and-appraise scenario. Once you cross six months of ownership, most of the same programs switch over to lending against the new appraised value instead of your cost basis, which is usually the bigger number after a good rehab.
There is a smaller group of true day-one, appraised-value programs, and Stacy's $100k note is pointing at one shape of that, but they tend to carry a rate premium and cap loan-to-value lower than a seasoned refinance would. Before you commit to going the no-seasoning route, run the numbers both ways. Compare what you'd net today off cost basis against what you'd net in three months off appraised value, factoring in the rate difference and the rent you'd be collecting in the meantime. Sometimes waiting the extra ninety days nets more usable cash than rushing the same day the tenant moves in. I underwrite these for a living and this is the tradeoff that trips people up the most.
- Tallahassee, FL · Member since 2026 · 4 posts · 1 vote1w
Thank you all for the added info. I appreciate it.
- 1wRobin SimonBusiness MemberLender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
You are going to get an "industry standard" of requiring a 6 months seasoning period to do a full on cash-out refinance based on the appraised value with most DSCR Lenders, a few "BRRRR-friendly" DSCR Lenders will have options for the 3-6 month seasoning mark, sometimes with LTV restrictions (like 70% Cash-Out max instead of normal 75%) or FICO Hurdles (like 700 to access this) and a small minority of DSCR Lenders will have true "no-seasoning" cash-out refinance options with less than 3 months. Generally, you'll want to find a lender that has options for all, with different restrictions rate/terms packages depending on how aggressive, how quick you want to go
Harpoon Capital512 Reviews - Lender · Houston, TX · Member since 2026 · 60 posts · 6 votes1w
Adding one piece to what Robin laid out, from the other side of the table. Whichever value they use, coverage still has to clear on the new payment. Pulling the maximum out at the new appraised value is exactly what pushes DSCR under 1.0, and in a lot of counties the tax and insurance line moves coverage more than the rate does. Run the payment at the loan amount you actually want before you pick the lender, not after they have pulled credit.
And one thing worth pricing since your money is tied up rather than gone. If the point is freeing capital for the next deal rather than putting permanent debt on this one, a short bridge against the stabilized property costs you two exits instead of one. Sometimes that is still the right answer. Sometimes it quietly eats the spread on the deal you are hurrying to buy.
What is it worth now against your all in, and is it leased yet? Those two answers decide which of the structures above you actually want.
- 1dChristian TurnerPro MemberLender · Coral Gables, FL · Member since 2026 · 20 posts · 5 votes
James, broker here. Short answer to your actual question: no, they don't all lend on purchase price. "No seasoning" means different things at different shops, and the difference is worth thousands to you, so ask each lender exactly which of these they do:
Purchase price plus documented rehab until month 6 (the most common "no seasoning" DSCR). You get an appraisal, but LTV is capped at the lower of appraised value or cost basis, so the rehab receipts and the contractor invoices are what unlock your equity. Keep every one.
Full appraised value with zero seasoning, usually at a lower max LTV (70-75% cash-out instead of 75-80%) and a rate bump of roughly 25-50 bps. This is the one Erik is describing above.
Appraised value after 90 days of ownership, which is where a lot of the better-priced programs land now; if you're within a few weeks of that mark, waiting often beats paying the no-seasoning premium.
Whatever you pick, get a rate lock plus a written prepay structure, and have the appraiser given your rehab scope so the after-repair comps are the right ones. If the goal is just to free cash for the next deal fast, a 12-month bridge on the finished property, then a DSCR takeout at month 6, is sometimes cheaper all-in than a no-seasoning DSCR at the higher rate.
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