Single-Family Rental and High-End Residential Investment Loans (1–4 Units)

Investment property only: the non-owner-occupied rule

Before anything else: our residential loans are strictly for investment property. The borrower, the guarantors and their families may not live in the home, now or after closing, and the loan must be for a business purpose. We do not make loans on primary residences or second homes, and we do not make loans for personal, family or household purposes. Our application asks you to confirm non-owner occupancy, and that confirmation is part of every residential loan we make.

Single-family rental loans for 1–4 unit properties

Single-family rentals are the backbone of many investors' portfolios: detached houses, townhomes and rowhomes, condos and small 2–4 unit buildings held for rent. We provide short-term bridge financing on these properties when a long-term rental loan is not yet the right fit, or cannot close in time. Typical situations include:

• Buying a rental that needs work. The house is vacant or dated and needs renovation before it can be leased at market rent.
• Buy, renovate, rent, refinance. A bridge loan covers the purchase and renovation phase, then a long-term rental loan takes it out once the home is leased.
• Quick-close purchases. Estate sales, auctions and off-market deals where a seller needs certainty in about two weeks.
• Refinance or cash-out. Pull equity out of a rental you own free and clear, or replace a maturing private loan.
• Small multi-unit rentals. Duplexes, triplexes and fourplexes, which are financed here rather than in our multifamily program for buildings of five or more units.
• Short-term rentals. Investment homes operated as furnished or short-term rentals, reviewed with the income history and local rules in mind.

High-end residential investment property

High-end homes are a different kind of investment. The buyers are fewer, values depend on finishes, setting and lot, and the right comparable sales can be hard to find. Banks often struggle with these properties when the plan is a renovation, a speculative resale or a luxury rental rather than a buyer moving in. We finance high-end residential property held as an investment, including:

• Purchase and renovation of a luxury home for resale
• Completion of a high-end home whose construction stalled
• Bridge financing on a finished luxury home while it is marketed for sale or lease
• Executive or luxury rentals held by an investor or an investment entity

On these deals we pay particular attention to valuation support, the scope and quality of the work, realistic marketing time at the target price, and carrying costs during the hold.

How we underwrite a residential investment loan

• Value today and after the work. As-is value and, if you are renovating, the estimated value after completion, supported by comparable sales. Valuation is handled in-house or with a broker price opinion (BPO), with no full appraisal.
• Current and market rent. For rentals, the in-place rent if the home is leased and the estimated market rent once it is ready, since that drives the long-term refinance.
• Rehab budget and timeline. A line-item scope of work, a realistic schedule and a contractor who can deliver it. On loans with renovation funds, leverage is measured against total project cost, up to 70% LTC.
• Condition and occupancy. Whether the home is vacant, leased, partly leased or under renovation, and any items that would stop a long-term lender.
• The exit. A refinance into a long-term rental (DSCR-style) loan once the property is leased, or a sale. We look at whether the expected rent or resale price supports that exit.
• The borrower. Experience with similar properties helps, but there is no minimum credit score. Credit is reviewed as part of the overall picture.

What to send with a residential deal

A complete first submission is the fastest way to a term sheet, which we typically deliver within 24 hours of intake review. Helpful items include:

• Property address, type and unit count
• Purchase contract or current loan payoff
• Current lease and rent, if occupied
• Estimated market rent after renovation
• Scope of work and rehab budget
• Photos of the current condition
• Comparable sales or rentals you relied on
• A short summary of similar projects you have done

None of these is a hard requirement on day one; send what you have and we will tell you what else matters for your deal.

Residential investment loan parameters

• Loan size: $100,000 to $2,000,000; smaller loans, and larger loans up to $5,000,000, are considered case by case
• Leverage: up to 70% LTV / LTC, first lien
• Rate: 10.99% to 12.99% (current typical range; subject to change, market conditions and underwriting)
• Origination: 2 to 4 points
• Term: 12 months, plus one optional 6-month extension
• Payments: interest-only; flexible prepayment
• Purchase down payment: typically 20% to 50%
• Term sheet: typically within 24 hours of intake review

All terms are indicative and subject to underwriting, valuation and diligence. Not a commitment to lend.

Where we make residential investment loans

We lend on non-owner-occupied 1–4 unit and high-end residential property in Washington DC, Maryland, Virginia, Delaware, Pennsylvania and New Jersey across the Mid-Atlantic, and in North Carolina. See where we lend for the markets in each state.

Apply for a residential investment loan

Start the loan application and choose Single-family rental (1–4 units) or High-end residential. You will be asked for the unit count, occupancy, current and market rent, your investment plan, and a confirmation that the property is non-owner occupied. Mortgage brokers can submit through our Broker Program. For larger apartment buildings, see multifamily bridge loans; for buildings with ground-floor commercial space, see mixed-use loans.