The Summary:
- Exit bridge loans faster with no-seasoning refinance options.
- Recapture up to 70% of your cash on stabilized 5–9 unit multifamily properties.
- Leverage market rents for vacant units to meet DSCR requirements during stabilization.
- 1-day underwriting turns to keep your money moving into the next acquisition.
For a developer, the hardest part of a small multifamily project isn’t the renovation — it’s the dead zone that occurs after stabilization. You’ve done the work and the building is performing, but your capital is trapped because traditional banks demand 12 months of seasoning before they’ll even discuss a cash-out refinance.
That 12-month wait is a direct hit to your capital velocity. If your equity is sitting in a stabilized 7-unit building, it isn’t out there funding your next acquisition.
The Strategy: Executing the No-Seasoning Cash-Out Refinance
Groundfloor Lending’s 5–9 unit DSCR loan program is built to act as the "take-out" financing the moment your project is ready. We don't care about the calendar; we care about the asset’s performance and your track record.
- Eliminate Seasoning Traps: We allow for a no-seasoning cash-out refinance (up to 70% LTV) as soon as the property is stabilized. You don't need to wait a year to prove the value you’ve already created.
- Solving the Occupancy Gap: Most institutional lenders won't quote a small multifamily refinance until the building is 90% occupied. We allow up to two vacant units and underwrite using market rents. This allows you to exit your high-interest bridge loan weeks or months earlier than traditional terms allow.
Technical Specs for Capital Velocity
We underwrite these 5-9 unit multifamily properties with the speed of a residential flip and the structure of a commercial loan. This is the bridge-to-perm exit strategy designed for the missing middle of real estate rehabbing and development:
- Loan Amounts: $350K to $2.5MM+.
- Maximum Leverage: Up to 70% for cash-out; 75% for purchase.
- Underwriting Speed: 1 business day. We provide real numbers so you can plan your next move.
- Asset-Based Approval: No personal DTI or income verification. If the DSCR works and your track record is solid, the deal moves.
The Bottom Line
In a market where traditional banks have gone "pencils down" or they’re dragging out closings for 60+ days, speed is your primary hedge. By utilizing a lender that understands 5–9 unit debt, you can keep your money moving and your business growing without the red tape.
Submit your next deal, and we’ll be in touch in 24 hours.
You can also call us at (404) 850-9224.
Quick FAQ
Q: Is there a seasoning requirement for a Groundfloor 5–9 unit cash-out?
A: No. We do not have a seasoning requirement. Once the property is stabilized and the ARV is supported, we can execute the refinance immediately.
Q: Can I get a DSCR loan for a 5–9 unit building with vacancies?
A: Yes. Our DSCR loan program specifically allows for up to two vacant units at the time of closing. We use market rents to support the DSCR, providing flexibility for stabilization projects.
Q: What is the maximum LTV for a multifamily cash-out refinance?
A: We offer up to 70% LTV on cash-out refinances for experienced investors in the 5–9 unit category.
Q: How does Groundfloor handle underwriting for small multifamily?
A: We provide underwriting feedback and terms within 1 business day. Our process is asset-based, focusing on the property’s cash flow, value, and your experience rather than personal tax returns and income.