Short answer: Once your rehab is done and the property is rented or ready to rent, a DSCR loan can pay off your hard-money or private loan and replace it with a long-term loan that qualifies on the rent. DSCR loans have no personal income verification. You need a payoff letter, an appraisal with a rent schedule, decent credit, cash reserves and enough time on title. DSCR loans are business-purpose loans for investment property only.
Why investors refinance out of hard money
Hard-money and private loans are built to be short. Most run a year or two, often interest-only, with the full balance due at the end. They pay for the purchase and the rehab. A DSCR loan takes over when the property starts earning rent. It swaps the short loan for a long-term one, and with enough equity it can return some of the cash you put in.
What you need to refinance
✓ Payoff letter from your private lender, good through your closing date
✓ Settlement statement from your purchase, showing the price you paid
✓ Rehab budget, invoices and receipts, plus before-and-after photos
✓ Signed lease, or the appraiser's rent schedule if the unit is empty
✓ Two months of bank statements showing closing costs and reserves
✓ LLC documents if the property is in an entity
✓ Proof of homeowners insurance, plus flood insurance if required
✓ Permission to pull your credit
The lender orders the appraisal itself. For the full list of what DSCR programs ask for, see the DSCR requirements and documents checklist.
Seasoning: when your new value counts
Seasoning means time on title, measured from the day you bought the property. Until a set number of months passes, many programs value the property at the lower of two figures: what you paid plus documented rehab costs, or the new appraised value. After that, the appraised value counts on its own. Each program sets its own seasoning period. Keep every rehab receipt, because they support the value you added.
How much cash you can take out
A cash-out refinance carries a lower loan-to-value cap than a purchase. A refinance that only pays off the private loan and closing costs, called a rate-and-term refinance, often allows more. Your appraisal, your DSCR ratio and your credit all set the final number, and each program sets its own caps.
The refinance, step by step
1. Call 45 to 60 days before your private loan matures. Extension fees add up fast.
2. Gather the documents above and request the payoff letter.
3. Appraisal and rent schedule. The appraiser confirms the value and the market rent.
4. Underwriting and title. The underwriter reviews credit, reserves, the lease and the LLC. Title confirms the payoff amount.
5. Closing. The title company or closing attorney pays off the private lender, and your new DSCR loan starts.
Florida and Georgia closing costs
• Florida: documentary stamp tax ($0.35 per $100) and intangible tax (0.2%) apply to the new mortgage. See DSCR loans in Florida.
• Georgia: intangible recording tax of $1.50 per $500 of the loan, capped at $25,000, and a Georgia attorney handles the closing. See DSCR loans in Georgia.
What slows a hard-money refinance
• Waiting until the private loan has already matured
• Missing rehab receipts, which can cap the value
• Unpermitted work the appraiser can't credit
• An LLC that has fallen out of good standing
• A vacant unit with no lease. Some programs lend less on vacant property.
Own rentals in other states? See where we offer DSCR loans by state.
Hard-money refinance: common questions
Can I refinance a hard-money loan with a DSCR loan?
Yes. A DSCR loan can pay off a hard-money or private loan on a rental property. It qualifies on the property's rent, with no personal income verification.
How long do I need to own the property before I refinance?
It depends on the program. Many programs allow a refinance that only pays off the private loan at any time. To use the new appraised value for cash out, most programs require a set seasoning period first.
Do I need to show my income to refinance out of hard money?
No. A DSCR refinance has no personal income verification. The lender still checks your credit, the appraisal, your reserves and the lease or rent schedule.
How much cash can I take out?
Each program caps cash-out refinances at a lower loan-to-value than a purchase. Your appraisal, DSCR ratio and credit set the final amount.
My hard-money loan is about to mature. What should I do?
Call us now and ask your private lender about an extension. The sooner the appraisal is ordered, the more room you have.
Can I refinance a property that isn't rented yet?
Some programs accept the appraiser's market rent for a vacant unit. Others lend less until a lease is signed.
Ready to pay off your hard-money loan?
Tell us about the property and your payoff date, and a licensed loan officer will check it against current DSCR programs. Prefer to talk? Call (386) 882-9980.
This page is general education, not a commitment to lend or an offer of specific terms. DSCR loans are business-purpose loans for investment property and are not available for owner-occupied homes. All loans are subject to credit approval, appraisal, underwriting guidelines, property eligibility and investor program availability. Not all applicants will qualify. Seasoning, loan-to-value and reserve requirements vary by investor program and may change. Tax figures come from Florida Statutes 199.133 and 201.08 and O.C.G.A. 48-6-61, checked October 22, 2026. FLO Mortgage is licensed as a mortgage lender in Florida (MLD2621) and Georgia (#1835856), Company NMLS #1835856; Broker Owner Joy McCoy Flores, NMLS #1096400. Equal Housing Opportunity. Licensing & Disclosures.