Loan amount based on rental income for SFH?

[Ted Kawabata]

BP Universe, Is there ever a way for a lender to use the rental income to determine a loan amount rather than an appraised value?

I renovated a single family home in Dallas, Texas and it looks great and should cash flow great. But the cash flow is only good because of a separate 1/1 apartment from a converted carport (ADU). Not many comps to work with. Only one, to be exact. So my appraiser came up with a value that isn't helping me. $162,000 to be exact.

But rents should be about $2,100/mo. Just listed it and hoping to place a tenant rather quickly.

Help! Please point me to a lender that you think might be able to work with my situation and loan me $150,000 or more.

Mahalo! (Thank you!)

[Joe Splitrock]

@Ted Kawabata it sounds like this is multifamily and not single family. There is two units. The appraisals I have seen for my investment properties (single or multiple unit) include both the comparable approach and income approach. The comparable looks for sales of similar units and the income approach uses rents of similar units.

Really the bank just wants to know that if you default and they have to sell, that they will get their money back. I would look for my own comparable properties and include duplex in the search. Bring that to the attention of the appraiser, explaining it is a duplex not a SFH. That should increase the value.