The Quick Read: Underwriting turns the rent roll into one rent used for lender review for each unit and adds them up. It then tests that total against the payment on the new, larger loan. Finally, the loan is sized to the lowest of the leverage limit, the rent-supported amount, and any proceeds cap, subject to underwriting.
- The loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines.
- Cash-out on standard rentals tops out at 75% LTV, and only on loans up to $1,000,000. It steps down as the balance grows.
- Cash-out stops entirely above $3,000,000.
- Coverage is recomputed on the new payment, so a property that passed before the cash-out can fail after it.
- Rent roll, leases, bank deposits, and the appraiser’s rent schedule must all tell the same story.
A “super jumbo” file is a very large loan balance. A rent roll is a unit-by-unit list of who pays what. Together they make a file where every number gets checked twice. This is how the check works.
Key Terms Defined
Super jumbo is an informal label for a very large loan balance. Each lender sets its own threshold. In the wholesale network Lendmire works with, the extra overlays start above $3,000,000.
DSCR (debt service coverage ratio) is the property’s monthly rent divided by its full monthly housing obligation: principal, interest, taxes, insurance, and any HOA dues. Commercial lending uses net operating income instead, per the definition on Wikipedia. Residential-style DSCR uses gross rent.
Rent roll is a unit-by-unit schedule showing tenant, lease dates, current rent, and deposit status.
Rent used for lender review is the single rent figure per unit that goes into the ratio.
PITIA is principal, interest, taxes, insurance, and association dues. On interest-only loans, lenders review the file on the interest-only version of that payment.
Cash-out refinance replaces your current loan with a larger one. You keep the difference.
Why Does a Lender Ask for a Rent Roll?
A rent roll is required when one lease cannot describe the property. That usually means two to four units, a partly vacant building, or a mix of lease types. A single-family rental can often run on one lease and the appraiser’s rent opinion.
The rent roll is the in-place evidence. The appraiser’s rent schedule is the market evidence. Underwriters compare the two, and the gap between them drives most of the questions on the file.
The forms matter here. Per the Fannie Mae Selling Guide, Form 1007 is the comparable rent schedule for a single-family property. Form 1025 covers small residential income properties of two to four units. DSCR loans borrow these form names only. The underwriting rules belong to the loan program, not to the agencies.
What Does a Lender-Ready Rent Roll Contain?
A good roll lets an underwriter verify each unit without calling you. The Form 1025 rent schedule compares actual monthly rent with estimated rent. Your roll should carry the same fields.
| Field | What it proves | What a mismatch triggers |
|---|---|---|
| Unit and tenant name | Who occupies what | Questions on related-party tenants |
| Lease start and end | Term and stability | Request for the signed lease |
| Current rent | In-place income | Comparison to market rent |
| Deposit history | Rent actually paid | Explanation letter or lower rent |
| Utilities and concessions | Net rent reality | Rent adjusted down |
Concessions deserve a note. Free months and paid utilities lower the real rent. List them up front instead of letting the underwriter find them.
The Underwriting Sequence, Step by Step
Across the wholesale network, the sequence runs the same way on most files.
1. Collect the evidence. Send the rent roll, signed leases, and recent bank statements showing deposits.
2. Order the appraisal. It sets the value, which drives LTV. It also sets market rent, which drives coverage. Above $2,000,000, two appraisals are required.
3. Cross-check. The underwriter matches lease rent against deposits and against the appraiser’s schedule.
4. Pick a rent used for lender review per unit. The usual convention is the lower of lease rent and market rent. A lease above market adds nothing.
5. Sum the rents and test coverage against the payment on the new loan.
6. Size the loan to the binding limit, covered below.
7. Clear the rest of the file: credit, reserves, entity documents, insurance, and title.
Step 5 is where cash-out surprises people. The new balance is larger, so the payment is larger. Coverage is recomputed from scratch. Passing on the old loan means nothing.
How Does Each Unit’s Rent Get Selected?
Within one building, different units can be treated differently. The pattern below is typical, though treatment varies by program and is subject to underwriting.
| Unit situation | Rent evidence | Figure typically used |
|---|---|---|
| Occupied, current lease | Lease plus deposits | Lower of lease and market |
| Month-to-month or expired | Written rent plus payment history | Lower of stated and market |
| Vacant | Appraiser’s market rent | Market rent opinion |
| Below market | Lease and deposits | Often the lower lease rent |
| Related-party tenant | Lease plus arm’s-length proof | Market rent, with explanation |
| Tenant on a repayment plan | Current rent only | Arrears excluded from income |
That last row trips people up. Back-rent payments are debt repayment, not income. The file has to separate current rent from catch-up money.
A Worked Example With a Hypothetical Roll
Consider a modeled fourplex. Treat every input as an assumption, not a market fact.
- Unit 1 sits on a current lease at market rent, so it counts at lease.
- Unit 2 has a lease above the appraiser’s market rent, so it counts at market.
- Unit 3 is month-to-month, with deposits matching the written rent, so it counts at the lower of stated and market.
- Unit 4 is vacant, so it counts at the appraiser’s market rent opinion.
The total of those four figures is the rent used for program review. Divide it by the payment on the new loan. In this model, the result lands near 1.05x on the new balance. The same property sat comfortably above 1.2x on the old, smaller loan.
At 1.00x or higher, a select-program file earns full leverage. If the figure had landed between 0.75 and 0.99, a path exists through select programs to $2,000,000, but LTV and terms adjust, subject to underwriting. No dollar rents appear here on purpose. The ratio is the story.
Why Does Loan Size Change the File?
Size adds gates that sit beside coverage. In practice, the ratio often is not the limit at this size. Leverage is. Here is the cash-out ladder for standard rentals on an investment property, each figure a ceiling through select wholesale programs, subject to underwriting:
| Loan band | Cash-out LTV ceiling |
|---|---|
| $150K to $1M | 75% |
| $1M to $1.5M | 70% |
| $1.5M to $2M | 60% |
| $2M to $3M | 60% |
| $3M to $4M | No cash-out |
| $4M to $6M | No cash-out |
| $6M to $10M | No cash-out |
The credit score that the top cell in each band needs is a separate matter. It is 660 at the first band, 700 at the second, and 720 at the next two. The program floor is 660 on loans up to $3,000,000 and 700 above it. A lower score takes a lower cell inside the same band.
Proceeds have their own limits. Cash-out is unlimited at or below 60% LTV, and capped at $1,500,000 above 60%. Borrowers with 680 or lower credit are held to a $1,500,000 cash-out cap above 60% LTV. Above $3,000,000, the deal works to purchase or rate-and-term only, reviewed case by case.
Short-term-rental collateral carries a 70% cash-out ceiling where it applies, and those files stop at $2,000,000. Terms depend on the lender’s guidelines, the property type, the leverage, and a full review of the credit profile.
Reserves are six months of PITIA on the subject property, or twelve for first-time investors. Cash-out proceeds cannot satisfy them. Interest-only runs 120 months, up to 75%, with coverage of 0.75 or better qualified on interest and insurance and taxes.
Diagnosing which gate binds is simple:
| If this fails first | Symptom | Typical response |
|---|---|---|
| Coverage | Rent total too low for the new payment | Smaller loan or interest-only |
| LTV | Equity thin for the band | Lower cash-out request |
| Proceeds cap | Need exceeds the cap | Split the need or restructure |
| Credit or reserves | Score or liquidity short | Lower cell or more assets |
DSCR vs. conventional financing
There are two common ways to finance an investment property, and they qualify you differently — here’s how investors weigh them.
Why investors choose it
- Qualifies on the property’s rental income — no personal tax returns, W-2s, or pay stubs needed to document income.
- No personal debt-to-income ceiling to clear, so existing mortgages and obligations don’t cap your borrowing the same way.
- Can be closed in an LLC, keeping the property inside a business entity.
- Built for scaling — not held to the limit on number of financed properties that conventional financing applies.
- Underwriting centers on the deal: generally qualifies when the rent covers the payment, a 1.00x coverage ratio being a common baseline (confirmed in underwriting).
- Designed specifically for investment property, including long-term and, where the program allows, short-term rentals.
Where it’s strong
- Often the lowest ongoing financing cost for a buyer who fully qualifies on personal income — a fit for a first property or a cost-first purchase.
Trade-offs for investors
- Requires full personal income documentation and must fit within a debt-to-income limit — salary, existing debts, and other mortgages all count.
- Typically held in your personal name rather than a business entity.
- Caps how many financed properties you can carry, which can become a ceiling as a portfolio grows.
- Evaluates you as a borrower as much as the property, which usually means more paperwork.
How investors usually choose: a first or single property often optimizes for the lowest financing cost; portfolio builders often optimize for leverage, vesting in an LLC, and scaling past conventional caps. The right answer depends on your goals, the property, and current guidelines — both paths run through select lenders in Lendmire’s wholesale network, with eligibility and terms confirmed in underwriting.
Rent Roll Red Flags, and How to Fix Them First
Underwriters read a rent roll like an investigator. These patterns draw questions:
- Leases signed shortly before the refinance.
- Family members or owner-related tenants.
- Cash payments with no bank trace.
- Every unit renting for exactly the same amount.
- Deposits that run below lease rent month after month.
Fix these before submission. Reconcile each unit’s lease to its deposits. Write a short explanation for any gap. Replace informal arrangements with signed leases. Confirm the landlord named on the leases matches the entity on title, since entity vesting is welcome but layered entities are not.
In the investor files Lendmire sees, the most common late condition is not a low ratio. It is a rent roll that disagrees with the bank statements. A 20-minute reconciliation before submission can save a round of conditions.
If the Rent Roll Falls Short
A thin roll does not end the conversation. It changes the structure. Options a lender may review:
| Option | What changes |
|---|---|
| Smaller cash-out | Lower balance, easier coverage |
| Rate-and-term refinance | No proceeds, often more leverage |
| Interest-only period | Reviewed on the lighter payment |
| Sub-1.00 program | Select lenders only; LTV and terms adjust |
| Raise rents, then refinance | Stronger roll, new appraisal |
| Full-documentation loan | Personal income carries the file |
Each path is subject to credit approval, property review, and underwriting. Lendmire’s piece on cash-out requirements when rent covers only 90% of the payment covers this scenario in depth.
Where This Lane Ends
This article describes one-to-four-unit properties, where DSCR runs on gross rent against the payment. Once a building passes four units, review typically shifts toward net operating income, operating statements, and a different underwriting lane. The rent roll matters there too, but it sits beside expense history instead of standing alone.
Short-term rentals work differently. Form 1007 is built for monthly leases. STR files qualify on twelve months of operating history at 80% of gross, with coverage of 1.00 or higher.
For the broader picture, Lendmire’s complete DSCR loans guide covers how these loans work from the start.
Frequently Asked Questions
Is a rent roll required on every file?
No. A single-family rental can often run on one lease and the appraiser’s rent schedule. Multi-unit properties and partly vacant buildings are where a roll becomes standard.
Does the lender use lease rent or market rent?
Usually the lower of the two. A lease above market adds nothing to the ratio. A lease below market may be used as written or require an explanation.
What happens if units are vacant?
Programs commonly use the appraiser’s market-rent opinion for a vacant unit. Treatment varies by program, so the file should be matched to a lender whose guidelines fit the building.
Can cash-out proceeds count toward reserves?
No. Reserves of six months of PITIA on the subject property, or twelve for first-time investors, must come from other assets. Cash-out never satisfies them.
Can an LLC borrow on a super jumbo cash-out?
Entity vesting is welcome through select programs, though layered entities are not. The landlord on the leases should match the vesting entity, subject to program terms.
Your Next Step
If you are buying or refinancing a high-balance rental property and want to see how the numbers work, Lendmire can help you compare super jumbo DSCR loan options based on the property income, the loan balance, credit profile, leverage, and investor goals. Lendmire is a mortgage broker that arranges business-purpose financing through select wholesale lenders in 41 markets, including Washington, D.C. Nothing here is a commitment to lend.
Investors weighing their equity options can start with Lendmire’s guide to cash-out refinance on an investment property.
Lendmire’s self-employed mortgages page presents both super jumbo programs, bank statement and DSCR, side by side.
About Lendmire
Lendmire, NMLS# 2371349, is a non-QM mortgage broker serving real estate investors in 41 markets, including Washington, D.C., through DSCR investor loan programs. Qualification is generally reviewed around the subject property’s rental income, not the borrower’s W-2 history — a practical fit for LLC-titled portfolios and self-employed investors. All scenarios remain subject to lender review and program guidelines. Two consecutive Scotsman Guide Top Mortgage Workplace recognitions (2025, 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. Wikipedia: Debt service coverage ratio
This article is part of Lendmire’s super jumbo DSCR loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can You Get Approved for a Super Jumbo DSCR Cash-Out Refinance on Ten Rentals? · Super Jumbo DSCR Cash-Out Refinance Requirements When Rent Covers Only 90% of Payment · Super Jumbo DSCR Cash-Out Refinance Requirements When Two Appraisals Are Required
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.