Cap rate valuation for Residential Refi

[Dan Sundberg]

Does anyone have any recommendations for a lender who will do a cash out Refi based on Cap Rate for a property with 4 or fewer units?

[Dan Sundberg]

Update to this. Talked to some lenders and found one that will do this. Properties are in Sacramento, CA and lender is Mt. Diablo Lending - Ramon Von Walker. They can cash out refi on residential income properties based on Debt Service Coverage Ratio (DSCR).

Very interesting option in this case because we are adding an ADU to the property, which appraisers haven't quite figured out how to value, and a refi based on cash flow can more than double the value an ADU brings. Higher interest rate, but might make BRRRR doable in a hot CA market...