Hard money exit refinance — a renovated rental ready for permanent financing

Hard money exit refinance — a renovated rental ready for permanent financing
Loan Program

The bridge loan has a clock. Here is the way out.

A hard money bridge loan runs 6 to 18 months. When the note comes due, the way out is permanent financing sized on the property, not the project: a DSCR loan that pays off the lender, carries the rental on its own rent, and does not ask for tax returns. Rate-and-term to 85% of the appraised value, cash-out to 75%, in 41 markets.

Plan My Exit Calculate Payment
The Fundamentals

Hard money lends on the plan. The exit lends on the property.

A fix-and-flip or bridge loan funds the purchase and the rehab against the plan: on the top experience tier a fix-and-flip loan reaches 93% of total cost and 75% of the after-repair value, with the rehab budget funded in full. The exit loan does not look at the plan. A DSCR lender sizes the permanent loan on the appraisal that comes back after the work and on the rent the property earns, and reaches 85% of that value on a rate-and-term payoff or 75% when cash comes out at closing. The gap between what hard money advanced and what the exit will refinance is the number every investor should know before the first contractor is paid.

Three things decide the exit: the appraised value after the work, the rent against the new payment (a coverage ratio of 1.00 qualifies on the standard lane; 1.25 is strong), and the credit score on the day of the application. Hard money accepts a 620 score with conditions below 660; the standard DSCR lane also starts at 620, and the short-term-rental and no-ratio lanes at 640. An investor who spent the rehab budget on value that never materialized, or who let the score slip during the project, finds the exit short of the payoff. Lendmire runs that math early, while there is still time to change it.

Size My Exit Loan
Three Ways Out

Pick the exit that fits the property.

The permanent loan follows what the property does now: a long-term rental, a rental with the rehab money coming back out, or a short-term rental or a thin-coverage file on its own lane.

DSCR

Rate-and-Term Payoff

The new loan pays off the hard money note and the closing costs, up to 85% of the appraised value, qualified on the rent with a coverage ratio of 1.00 or better and a 620 score. No employment or tax-return review; title can be held in an LLC.

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DSCR Cash-Out

Payoff Plus the Rehab Money Back

The refinance pays off the note and returns the capital that went into the project, up to 75% of the appraised value, with 6 months of reserves on a cash-out. The lane investors use to go buy the next one.

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STR & No-Ratio

Short-Term Rentals and Thin Coverage

A short-term rental exits on its own lane at 70% rate-and-term and 70% cash-out with a 640 score, documented by a twelve-month rental history or a market data report. A property whose coverage does not reach 1.00 can use the no-ratio lane: 70% rate-and-term, 65% cash-out, 640.

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Leverage limits, coverage thresholds and credit floors are program parameters, not offers; the appraised value, the rent, the credit profile, reserves and underwriting decide every file. DSCR and hard money loans are business-purpose financing for investment property, not consumer mortgages. Loan amounts on the standard DSCR lane run from $100,000 to $3,000,000.
Program Highlights

What makes an exit close.

The Leverage Gap
Hard money advances up to 93% of cost and 75% of after-repair value on the top tier; the exit refinances 85% of the appraised value, 75% with cash out. A project that borrowed to the top of hard money’s limits has to appraise high enough for the exit to cover the payoff.
Qualified On The Rent
A DSCR loan qualifies the property, not the paycheck: a coverage ratio of 1.00 on the standard lane, 1.25 where the file is strong, with no tax returns and no employment verification. The rent is documented by the lease or a market rent analysis.
The Credit Floor
Hard money closes with a 620 score, with conditions below 660; the DSCR exit starts at 620 on the standard lane and 640 on the short-term-rental and no-ratio lanes. The score on the day of the exit application is the one that counts, so it has to be protected through the project.
A Term, Not A Deadline
Bridge terms run 6 to 18 months. The exit is a full underwrite with an appraisal, so the file is opened while the work is finishing, not the month the note matures. Opening the file early leaves room to fix what the appraisal or the rent turns up.
Why Lendmire

We take the panicked call. We would rather take it early.

First-time investors are the ones the clock catches: the hard money lender approved the score and funded the rehab, the project ran long, and the permanent lender wants a higher score, a finished appraisal and a coverage ratio the rent has to carry. Lendmire sizes the exit before the note is due, on the appraised value and the rent, and tells you in writing what the payoff covers and what it does not.

We place the exit with multiple wholesale DSCR lenders across 41 markets, so the file lands on the lane that fits it: the standard rate-and-term payoff, the cash-out that returns the rehab capital, the short-term-rental lane, or the no-ratio lane for a property whose coverage is still thin. An investor who calls while the work is finishing has choices. An investor who calls after the maturity notice has fewer.

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Also Consider

Programs on both sides of the exit.

The bridge loan on the way in, the permanent programs on the way out, and the cash-out that funds the next purchase.

The Way In

Hard Money Loans

Fix-and-flip, bridge and ground-up construction financing: leverage to 93% of cost on the top tier, bridge terms of 6 to 18 months, the rehab budget funded in full in draws against completed work. Business-purpose financing for investors.

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The Way Out

DSCR Loans

Permanent investor financing qualified on the property’s rent: a coverage ratio of 1.00 qualifies, 85% rate-and-term, 75% cash-out, 620 credit floor, 41 markets.

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The Next Deal

Investment Property Cash-Out

Pull the equity out of a stabilized rental to 75% of value and fund the next acquisition, with 6 months of reserves and the rent carrying the new loan.

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Learning Center

Know before you borrow.

Exit scenarios, the leverage gap, the credit-score trap and the appraisal math, from our licensed loan officers.

Take the Next Step

Tools to move from reading to action.

Tool One

Mortgage calculator

Run the numbers on a refinance — including principal, interest, taxes, and insurance on the new loan.

Calculate Tool Two

Get a quote

Start a scenario review in under 30 seconds. A Lendmire loan officer follows up with the options in writing.

Start Tool Three

Compare the three exits

See whether a rate-and-term payoff, a cash-out that returns the rehab capital, or the short-term-rental lane fits the property you are finishing.

Compare
Get Started

Know what the exit covers before the note is due.

In about 30 seconds you can start a scenario review for the property: the appraised value, the rent and the payoff, and the lane that fits. No commitment required.

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