The Quick Read: A bank statement cash-out refinance on a rental is reviewed against documented deposits instead of tax returns, and remote signing is a separate approval that the lender, the title company, and the property’s state must each allow before you can sign away from a closing table. Ask about both before you apply. The right program depends on your deposits, your credit, and the property.
- Income is tested on 12 months of business or personal bank statements, averaged, then reduced by lender expense factors.
- Cash-out on an investment property tops out around 75% LTV (loan-to-value, the loan as a share of the property’s value).
- Remote signing comes in several forms, and only some are fully remote.
- The title company usually has the last word on which signing route works for your county.
- A DSCR loan tests the rent instead of your deposits, and for investors with many mortgages that can be the deciding difference.
How Does a Bank Statement Cash-Out Refinance Work on a Rental?
The lender reads your bank statements instead of your tax returns. It strips out deposits that are not real income, averages what remains, and applies an expense factor to business deposits. That result becomes your qualifying income. Then the lender sizes the cash-out against both your income and the equity in the property.
DSCR Cash-Out Calculator
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Rate source: Freddie Mac 30-yr average via FRED® — Federal Reserve Bank of St. Louis · effective Oct 29, 2026
Prefilled with starting assumptions — enter your property’s value, balance, taxes, and insurance for a more accurate picture.
Program parameters update from Lendmire’s centralized guideline source. Taxes and insurance are editable estimates.
As of Oct 29, 2026 · General Freddie Mac market benchmark, not a Lendmire loan offer. Property value, balance, taxes, and insurance are editable estimates. Maximum loan-to-value varies by lender, program, property type, and seasoning. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
Here is the sequence a file usually follows:
1. Choose the documentation lane. You use bank statements, a rent-based DSCR loan, or another route such as assets.
2. Scrub the deposits. Transfers between your own accounts, loan proceeds, and refunds come out. The rest gets averaged.
3. Apply the expense factor. Business-account deposits are cut by a lender-specific factor. Scotsman Guide’s overview of non-QM lending describes the same structure: a standard expense factor, or a profit-and-loss statement prepared by a third-party tax professional in its place.
4. Check debts and reserves. The new payment joins your other obligations. Reserves commonly run around six months of the housing payment.
5. Size the cash-out. Equity caps the loan and income caps it again. The smaller of the two limits wins.
6. Appraise the property. The lender orders an appraisal, and a rental usually gets a rent schedule too.
7. Settle the signing route. This step gets its own section below, because it trips up more out-of-state owners than the income test does.
Across the wholesale network Lendmire works with, no single expense factor applies everywhere. Each lender sets its own, so two lenders can read the same statements and land on different incomes. That gap is the main reason a broker who shops several programs earns the fee. The complete DSCR loans guide covers the rent-based alternative in detail.
What Does Occupancy Change on a Cash-Out?
Occupancy changes the leverage ceiling and the paperwork. On an investment property, a cash-out typically tops out around 75% LTV. On an owner-occupied file, a cash-out on a primary residence runs up to 80% LTV with a fixed expense ratio, or 75% with an accountant-prepared ratio. A second home runs up to 75% LTV, depending on loan size and credit.
Notice that the accountant-prepared route has the lower ceiling, not the higher one. Many borrowers assume more paperwork buys more leverage, and here it does not.
One more difference matters. An owner-occupied file is a consumer mortgage with consumer disclosure rules. A bank statement loan on a non-owner-occupied rental, including a short-term rental, is a business-purpose loan and is exempt from those consumer disclosure rules. Your property’s occupancy decides which package you get, so never mix the two when you compare quotes.
Investment purchase leverage on bank statement documentation varies by lender, so treat any single number you hear for purchases with suspicion.
Which Remote Signing Routes Exist?
Remote signing is not one thing. Remote online notarization, known as RON, means signing before a commissioned notary over live audio and video. Proof’s guide to closing remotely separates it from hybrid closings and in-person electronic notarization, where people still meet physically. Nearly every state allows some form of RON, but allowed in the state does not mean accepted on your file.
| Route | Who is physically present | Common blocker |
|---|---|---|
| Fully remote (RON) | Nobody; all on video | County or title insurer will not accept it |
| Hybrid eClosing | Notary with you, rest digital | Needs a local notary visit |
| Mobile notary, ink signing | Notary comes to you | Original documents must ship back |
| Mail-away | You, at your own table | Courier steps add handling |
A mobile notary is often the practical fallback. If you are in Phoenix and the rental is in Ohio, a notary can meet you at your kitchen table. Your signature is witnessed locally, and the title company handles the rest.
Who Approves a Remote Signing?
Three parties each hold a veto, and a yes from one does not bind the other two. State law alone does not settle it.
| Party | What it decides |
|---|---|
| Lender or loan buyer | Whether the program accepts remote execution |
| Title or closing agent | Which routes it will run and insure |
| State and county | Notary rules and what the recorder accepts |
The lender’s program sheet is the first gate, because the investor who eventually buys the loan may require ink or in-person steps. The title company is the second gate, since it insures the lien and decides what it is willing to stand behind. The county recorder is the third, and some counties are slower to accept electronic documents than others.
The practical rule is simple. Ask for the signing route in writing before you pay for an appraisal. A lender that says “we do remote closings” has not answered the question for your property, your county, and your documents.
What Changes on a Cash-Out Refinance Versus a Purchase?
A refinance has no seller and no keys changing hands. Instead, the new loan pays off the old one, and the leftover cash goes to you. That makes the payoff statement, the wire instructions, and the identity checks the pressure points.
Business purpose also changes one step. A true non-owner-occupied rental is deemed business-purpose under the federal rule on exempt transactions, and business-purpose loans fall outside the home-loan settlement rules in 12 CFR §1024.5. In practice you skip the consumer waiting period before cash is released. A loan that stays consumer-purpose does not skip it.
Business purpose is not automatic, though. Signing an affidavit does not make a consumer loan exempt. A duplex where you live in one unit raises a real classification question, and that one belongs with your lender’s counsel, not in a form you sign and hope for the best.
Closing From Another State: Whose Rules Apply?
When you, the notary, and the property sit in three different places, the answer depends on the act. In general, the notary’s commissioning state governs the notarial act, while the property’s county governs recording. Do not treat that as settled for your file. Ask the title company which combination it will run.
Attorney-closing states add friction, because some require a local attorney to supervise the closing. Some counties and title insurers also decline remote notarization outright. None of this blocks your loan. It just means the fallback route should be picked at the start, not discovered at the end.
A power of attorney is the riskiest shortcut. It must grant express authority to sign loan documents and place a lien, and the lender and title company must both approve the wording. Some states also restrict remote notarization of powers of attorney. If you can sign personally by mobile notary, that is almost always the cleaner path.
What About LLC and Entity Borrowers?
Whether a program will lend to an LLC at all varies, subject to program terms. If it will, the signer has to prove authority to act for the entity. Expect to provide the operating agreement, a resolution authorizing the loan, and often a certificate of good standing.
Entity files add one signing wrinkle. The person on camera must match the authorized signer, and the entity name must match the vesting on the title. A mismatch found on closing day is a document problem, and it is the kind of problem remote signing makes harder to fix.
Bank Statement or DSCR on a Rental?
Bank statements test you. DSCR (debt service coverage ratio) tests the property, dividing its rent by its full monthly obligation. Scotsman Guide frames the two the same way: bank statement loans look at borrower cash flow, while DSCR loans look at whether property cash flow covers the loan.
| Factor | Bank statement | DSCR |
|---|---|---|
| What gets tested | Your deposits | The property’s rent |
| Effect on personal debt load | New payment counts against you | Usually tested at the property |
| Best fit | Strong deposits, one or few rentals | Many rentals, thinner personal income |
| Expense treatment | Factor applied to deposits | Property’s own numbers |
Forum-style complaints that bank statement loans punish you twice for expenses have a kernel of truth. The expense factor trims your deposits, and your other expenses already shaped those deposits. For a pure rental play, the rent-based route often fits better. Lendmire’s DSCR cash-out refinance lenders with remote signing on an investment property covers that side.
Programs below a 1.00 coverage ratio are available through select lenders in the network, but LTV and terms adjust.
What Should You Ask a Lender About Remote Signing?
Ask these questions before you commit to anyone. They work with any loan officer, and a vague answer is useful information.
- Does this specific program permit fully remote online notarization on a cash-out of an investment property?
- Which title company will close it, and which routes will that company run in my property’s county?
- If remote is not accepted, which fallback does the program allow: hybrid, mobile notary, or mail-away?
- Will the signer be me personally, or an entity officer, and what authority documents do you need?
- How will you verify wire instructions, and how will the payoff be confirmed?
- Does this loan stay business-purpose, and how is that decided on my file?
A broker earns its keep here. Lendmire is a mortgage broker that works with a network of wholesale cash-out refinance lenders, so it can ask these questions across several programs at once instead of hoping one lender’s answer applies to your file. The right lender for your file depends on your deposits, credit profile, leverage need, and property type.
A Worked Sequence for an Out-of-State Owner
Picture an investor who lives in one state and owns a rental in another. The steps below show how the file usually runs.
1. Pre-screen. The broker reviews 12 months of statements and matches the scenario to programs that fit the deposit pattern.
2. Confirm signing in writing. The title company states which routes it will run in the property’s county.
3. Gather the file. You supply statements, entity documents if the rental sits in an LLC, proof of insurance, and rent evidence.
4. Appraisal access. A tenant, property manager, or lockbox lets the appraiser in. You do not need to attend.
5. Final documents. The title company schedules the notary, whether by video or a mobile visit near you.
6. Identity check. The notary verifies who you are, often by a document scan and knowledge-based questions.
7. Payoff and proceeds. The new loan pays off the old one, and the remaining cash comes to you after the signing steps are complete.
No step here requires you to fly to the property.
When Remote Signing Is Not Available
A closing that cannot go remote is not a dead file. It switches to a fallback.
- Mobile notary: the closest substitute, with documents shipped overnight.
- Hybrid closing: you meet a local notary while the rest stays digital.
- Local title office: a branch near your home, if the title company has one.
- Attorney closing: sometimes required, and sometimes offered as a workaround.
Each fallback adds handling steps, so ask early. A route chosen at application rarely causes trouble. A route discovered at the end can.
What Protects You From Wire Fraud in a Remote Closing?
Treat the wire instructions like cash. Verify them by calling the title company at a number you looked up yourself, never one from an email. Be suspicious of last-minute changes to account details. Confirm the payoff amount against the statement from your current lender. Use only the secure portal your title company provides.
These habits matter more with a remote signing, because you never see the closing agent in person.
Key Terms Defined
Bank statement loan: A loan that is reviewed around average deposits from 12 months of statements instead of tax returns.
Cash-out refinance: A new loan that pays off the old one and gives you the extra equity as cash.
Remote online notarization (RON): Signing in front of a commissioned notary over live audio and video.
Hybrid closing: A closing where some steps are digital and a notary still meets you in person.
Mobile notary: A notary who travels to you to witness ink signatures.
LTV: Loan-to-value, the loan amount divided by the property’s value.
Business-purpose loan: A loan made for a rental or investment use, reviewed differently from a standard owner-occupied mortgage.
Reserves: Cash left after closing, often counted in months of the housing payment.
Program Parameters at a Glance
These figures reflect select lenders in Lendmire’s wholesale network. They are typical ranges, subject to lender guidelines, and not a commitment to lend. A bank statement loan is reviewed on documented income under the applicable program, subject to lender guidelines.
| Item | Typical range |
|---|---|
| Documentation | 12 months of bank statements |
| Cash-out, investment property | Up to 75% LTV |
| Cash-out, primary residence | Up to 80% LTV (75% with accountant-prepared ratio) |
| Cash-out, second home | Up to 75% LTV |
| Loan amounts | $125,000 to $3,500,000 |
| Reserves | About 6 months |
Lendmire’s consumer mortgage licensing covers 16 states, so confirm that your property’s state falls inside that footprint. Loan terms follow each lender’s program sheet, so ask about term length rather than assuming it.
Frequently Asked Questions
Can I do a bank statement cash-out refinance on a rental property?
Yes, on many programs, and the cash-out ceiling on an investment property is typically around 75% LTV. Your deposits are averaged, adjusted by an expense factor, and weighed against your other debts and the property’s equity. Each lender sets its own rules, so the same statements can produce different results.
Is remote signing allowed on an investment property cash-out?
Often, but three approvals must line up: the lender’s program, the title company, and your state and county. Nearly every state allows some form of remote notarization, yet some counties and title insurers still decline it. Ask for the signing route in writing before the appraisal.
What if my state or county will not accept remote notarization?
You switch to a fallback, usually a mobile notary or a hybrid closing. Documents may need to be shipped, and attorney-closing states can add a local attorney. The loan itself is not affected, only the signing mechanics.
Can I sign through a power of attorney?
Sometimes, but it is the riskiest route. The document must expressly authorize signing loan papers and granting a lien, and both the lender and title company must approve the wording. Some states restrict remote notarization of powers of attorney, so personal signing is usually cleaner.
Should I choose bank statements or DSCR for a rental?
It depends on what you want tested. Bank statements test your deposits, so the new payment counts against your personal debt load. DSCR tests the property’s rent against its monthly obligation, which often suits investors holding several mortgages.
Next Step
If you are self-employed and want to see how the numbers work, Lendmire can help you compare bank statement loan options based on your deposits, the property, credit profile, leverage, and your goals. An out-of-state rental does not have to mean a flight to the closing table.
A deeper walk-through of investment-property equity extraction lives in Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire, NMLS# 2371349, is a mortgage brokerage with consumer lending licenses in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages are arranged through wholesale lending partners for borrowers whose tax returns understate their income, and each application is reviewed individually by the lender. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. Scotsman Guide, Rev Up the Engine for Non-QM Lending
2. Proof, A Guide to Closing on a House Remotely
3. CFPB Reg Z §1026.3, Exempt transactions
4. 12 CFR §1024.5, RESPA coverage
This article is part of Lendmire’s bank statement loan program — full qualification details, guidelines, and scenarios live on the program page.
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Compliance and disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage broker and is not a direct lender, depository institution, financial advisor, or tax professional. Content in this article is general market analysis and educational information — not financial, legal, or tax advice for any specific situation. Lendmire does not guarantee loan approval; every transaction is subject to underwriting by the funding lender. Mortgage pricing and loan program guidelines are subject to change at any time without notice and vary by borrower characteristics, property type, and state regulations. Lendmire complies with Equal Housing Opportunity. Licensure verification: NMLS Consumer Access.