Cedarline Capital Partners
DSCR Rental Loan4-unit residential cash-out refinance, Ohio
- Rate
- 7.625%
Pricing would be 7.625% fixed for a thirty-year term
- Term
- 30 years
seven point six two five percent fixed for a thirty-year term
- Leverage
- 70.00%
sized to 70% of the as-is appraised value
- Fees
- 2.00%
An origination fee of two percent of the loan amount, being $8,250
This sheet answers 21 of the 47 terms this tool looks for.
26 terms are not addressed at all — a term the sheet leaves out is not an absent cost, it is a cost nobody has quoted you yet, which is what the 26 questions below are for.
The verdict
Graded against the rules the industry actually uses, then stress-tested on the way out. New to this? Start here.
83 out of 100
This is a competitive sheet. The asks below are about trimming, not fixing.
How it scores
- Debt service coverage required1.25× coverage standard
This is the test of whether the rent covers the mortgage. A 1.25 means the lender wants rent to be 25% more than the payment. The lower the number they will accept, the more you can borrow on the same property.
COkay
- This deal:
- 1.15x
- Industry norm:
- 1.00–1.25x typical for DSCR; 1.25x+ for commercial
- Read from:
- dscr minimum
- Interest rate
What the money costs per year. Worth remembering that on a short-term loan the fees often matter more than the rate, because you only pay the rate for a few months but you pay the points in full on day one.
AStrong
- This deal:
- 7.6%
- Industry norm:
- 6.875–13.125% for this loan type
- Read from:
- interest rate
- All-in cost of capitalRate + fees over the actual hold
The rate is not the price. Add the points and spread everything over how long you actually hold the loan, and a "9%" loan with 1.5 points over 12 months really costs you more than 9%.
AStrong
- This deal:
- 7.7%
- Industry norm:
- 7–9% all-in
- Personal liability
The lender is limited to the property itself, except for specific bad acts like fraud. This is the borrower-friendly version.
AStrong
- This deal:
- Non-recourse with carve-outs
- Industry norm:
- Non-recourse with standard carve-outs is the better outcome
- Freedom to repay early
There is a cost to paying this off early. Check both the prepayment penalty and the minimum interest — the second one does the same job under a different name.
COkay
- This deal:
- 3/2/1 declining
- Industry norm:
- Bridge loans should be open or near-open; watch minimum interest
How to push back
Specific asks, with why they land. Ask for several; concede the ones set by their credit box.
- Ask for 1.50% origination instead of 2.00%.Usually works
Points are the most negotiable line on any term sheet, and the ask costs you nothing. It lands far more often when you can say another lender has quoted you lower.
- Ask whether interest runs on the full commitment or only on funds drawn — and get the rate for the other one.Usually works
On a loan with a large holdback this is worth more than half a point of rate, and it is not on the page. Lenders quote both when asked.
- Ask for the good faith deposit to be refundable if the lender declines after underwriting.Worth a try
The deposit protects them if you walk and normally does nothing for you if they do. Making it symmetrical is a reasonable ask and rarely refused outright.
Analysis
Derived from the extracted terms — not from the label on the document.
What this loan is, read from its terms
✓ The terms are consistent with a DSCR rental loan.
How we worked that out
- — Term stated in years ("30 years") — that is 360 months.
- — Term of 360 months makes this a long-term loan.
- — Interest-only for 120 months, then amortizing.
- — Qualified on property income — a coverage test is present.
Numbers this sheet does not give you
- Points payable at closing
- $8,250
- Interest per year at this rate
- $31,453
2.00% of $412,500.
7.63% of $412,500. On a monthly basis, $2,621.
Questions to ask your lender
Generated from what this sheet left out, left vague, or priced outside the normal range for a dscr rental loan.
26 questions, most important first.
- Loan PurposeNot addressed
What purpose is this priced as? If I switched to a cash-out refinance, what happens to the rate and the maximum LTV — and is there a seasoning period before I can?
This term sheet does not address this at all.
- Income Qualification SourceNot addressed
Do you use the in-place lease, market rent, or the lesser of the two? What happens if a unit is vacant at closing, or on a month-to-month tenancy?
This term sheet does not address this at all.
- Short-Term Rental Income TreatmentNot addressed
What factor do you apply to trailing STR revenue, and what documentation do you accept? If I have no operating history, will you use a market projection, and on what terms? Can I fall back to long-term market rent if it qualifies better?
This term sheet does not address this at all.
- Eligible Property TypesNot addressed
Is my specific property type eligible on this program — including unit count, condo warrantability, and rural designation? Does any of it change the rate or the LTV cap rather than simply disqualify me?
This term sheet does not address this at all.
- Non-Recourse Carve-Outs (Bad Boy)Not addressed
Please send the full carve-out list now rather than at documentation. Are any of them full-recourse triggers rather than loss-only? Is there a carve-out for failure to deliver reporting?
This term sheet does not address this at all.
- Minimum Credit ScoreNot addressed
What are your pricing tiers by score, and where does my score fall relative to the next break? Do you use the mid-score, the lowest, or the primary guarantor only?
This term sheet does not address this at all.
- Cross-Collateralization and Cross-DefaultNot addressed
Are the properties cross-collateralized, cross-defaulted, or both? What does it take to release one property, and what is the release price?
This term sheet does not address this at all.
- Rate LockNot addressed
When can I lock, for how long, and what does an extension cost? What happens to my pricing if the market moves before I can lock?
This term sheet does not address this at all.
Standardized terms
Economics
Loan Amount
The principal the lender is offering to advance.
$412,500
We would look to advance $412,500 against the subject property
Loan Purpose
The transaction type this loan is priced as — acquisition/purchase, rate-and-term refinance that replaces existing debt, or cash-out refinance that returns equity to the borrower. This is how the borrower comes to own or re-finance the asset, not what will be built or renovated on it: a scope of work, a construction description or a property description is not a loan purpose.
Not addressed
Two sheets are not comparable until you know this. Purpose sets the LTV ceiling and the price before any other factor — a cash-out refinance is typically capped several points below a purchase and carries a rate add-on, so a cash-out quote that looks worse than a purchase quote may in fact be the better offer. A sheet that never states it is quoting against an assumption you have not seen.
Typical: Purchase, rate-and-term refinance, or cash-out refinance
Loan-to-Value (LTV)
The loan amount as a percentage of the property value — usually the lesser of purchase price and appraised value.
70.00%
70% of as-is appraised value (cash-out maximum)
sized to 70% of the as-is appraised value
Interest Rate
The annual rate charged on the outstanding balance.
7.625%
Pricing would be 7.625% fixed for a thirty-year term
Rate Structure (Fixed / Floating, Index, Spread, Floor)
Whether the rate is fixed for the term or floats over an index such as SOFR, plus the spread added to that index and any floor below which the rate cannot fall.
Not addressed
A floating rate with a floor is a one-way bet against you: you get none of the benefit if rates fall below the floor, and all of the exposure if they rise.
Typical: Almost always fixed for the full 30-year term
Origination Fee / Points
The lender's fee for making the loan, stated as a percentage of the loan amount.
2.00%
2% of the loan amount, being $8,250
An origination fee of two percent of the loan amount, being $8,250
Discount Points (Rate Buydown)
Optional points paid at closing to reduce the interest rate.
Not addressed
Whether a buydown pays depends entirely on how long you hold the loan. On a DSCR loan you plan to refinance in three years, most buydowns lose money.
Term
How long until the loan matures and the full balance is due.
30 years
seven point six two five percent fixed for a thirty-year term
Amortization
The schedule over which principal is repaid. Longer amortization means lower payments and a larger balance left at maturity.
360 months
on a thirty-year amortization schedule
Interest-Only Period
A period during which only interest is due and the principal balance does not reduce.
10 years, at borrower election
with the first ten years payable on an interest-only basis at your election
Day Count / Accrual Convention
The convention used to compute interest — 30/360, Actual/360, or Actual/365.
Not addressed
Actual/360 charges interest for 365 days on a 360-day denominator, which costs about 1.4% more per year than 30/360 at the same stated rate. It is almost never explained.
Typical: 30/360 typical
Credit Tests
Minimum DSCR
The minimum ratio of property income to debt service the lender requires. A 1.25x requirement means income must be 25% above the payment.
1.15x
Our program minimum is 1.15 times for cash-out at this leverage.
DSCR Calculation Method
How the ratio is actually computed — gross rent over PITIA, or net operating income after an expense factor over debt service, and whether the payment used is the amortizing one.
Tested on the fully amortizing payment
Our debt service coverage test is calculated on the fully amortizing payment regardless of whether you are actually paying principal.
our debt service coverage test is calculated on the fully amortizing payment
Typical: Single-asset: gross rent ÷ PITIA. Portfolio: NOI after expense factor ÷ amortizing debt service
Income Qualification Source
Which rent figure the lender uses — the in-place lease, market rent from a Form 1007 rent schedule, or trailing short-term-rental revenue.
Not addressed
Determines whether a below-market lease or a vacant unit sinks your loan. Lenders commonly use the lesser of actual and market, which caps the benefit of a strong lease.
Typical: Lesser of in-place lease rent and Form 1007 market rent
Short-Term Rental Income Treatment
How revenue from short-term rental platforms is counted — typically trailing twelve months of actual receipts with a haircut factor applied.
Not addressed
The haircut is applied before the coverage test, so a 17% reduction in counted revenue can be the difference between approval and decline. Terms are also tighter across the board: lower LTV, higher minimum DSCR, more required liquidity.
Typical: T12 platform revenue with a haircut factor; lower LTV and higher reserves
Minimum Credit Score
The minimum qualifying credit score, usually the mid-score of the primary guarantor.
Not addressed
Prices the loan in tiers as much as it gates it. A 20-point improvement can be worth a quarter point in rate or five points of leverage.
Borrower Experience Requirement
The number of comparable projects completed, used both to qualify the borrower and to set the pricing tier.
Not addressed
In the bridge category experience is priced directly: the gap between a first-timer and a ten-deal operator can be two points of rate and ten points of leverage.
Typical: Some programs require ownership of at least one other rental property
Eligible Property Types
The stated rule about which property types this program will lend on, and which it excludes or prices differently — unit count, condominium, rural, mixed-use, manufactured, short-term rental. This is the eligibility policy the sheet sets out, not a description of the subject property: "two detached single-family residences" is what this deal happens to be, whereas "1–4 unit non-owner-occupied; no rural, no manufactured" is the rule. If the sheet only describes the subject property and states no policy, this term is absent.
Not addressed
This is the most common reason a quote evaporates between term sheet and underwriting. Eligibility is decided by the program, not the deal, so a sheet issued before anyone looked at the subject property can be withdrawn in full once they do. A rate you cannot actually use on your property is not a rate.
Typical: 1–4 unit residential; condo warrantability, rural and short-term rental treated separately
Citizenship / Residency Requirement
Whether the borrower must be a US citizen or permanent resident, and the terms offered to a foreign national or a borrower on a visa.
Not addressed
A standard overlay that is rarely printed on the first page. Foreign-national programs exist at most investor lenders but carry their own pricing, a lower LTV ceiling, and documentation the borrower cannot produce quickly — passport, visa, US credit alternative, and often reserves held in a US account. Discovering it at underwriting costs the rate lock.
Typical: US citizen or permanent resident assumed; foreign-national programs priced separately
Seasoning Requirement
How long you must have owned the property before the lender will do a refinance, especially a cash-out.
6 months from deed recording
we require six months of seasoning of ownership before a cash-out refinance
Ongoing Financial Covenants
Tests you must keep meeting after closing — net worth, liquidity, DSCR, and reporting obligations.
Not addressed
These are how a performing loan becomes a defaulted one without you ever missing a payment. A liquidity covenant tested annually can be breached by a bad quarter.
Typical: Portfolio loans only; single-asset DSCR loans rarely carry them
Structure & Risk
Recourse
Whether the lender can pursue your personal assets beyond the property. Non-recourse limits them to the collateral; full recourse does not.
Non-recourse with standard carve-outs
Non-recourse as to repayment, save that members holding twenty percent or more guarantee the customary carve-outs.
non-recourse as to repayment, save that you personally... will be required to guarantee the customary carve-outs
Typical: Non-recourse with standard carve-outs; personal guaranty of the carve-outs
Non-Recourse Carve-Outs (Bad Boy)
The acts that convert a non-recourse loan into a recourse one — typically fraud, misapplication of funds, waste, unpermitted transfers, and voluntary bankruptcy.
Not addressed
Term sheets almost never list them. Some carve-out sets are so broad that ordinary operating missteps trigger full personal liability, and you will not discover that until the loan documents arrive.
Typical: Standard set: fraud, misapplication of rents, waste, transfer, bankruptcy
Entity / Vesting Requirement
The legal entity that must hold title — commonly an LLC, sometimes a bankruptcy-remote single purpose entity with an independent manager.
Not addressed
Business-purpose loans do not close in an individual name. SPE requirements add legal cost and, where a non-consolidation opinion is required, several thousand dollars and a week of time.
Typical: LLC or corporation; title must be in the entity at closing
Cash Management / Lockbox
An arrangement where property income flows into a lender-controlled account. "Springing" means it activates only on a trigger; "hard" means it applies from day one.
Not addressed
Once it springs, you lose day-to-day control of your cash flow, and the cure conditions are usually harder to meet than the trigger was to trip.
Typical: Portfolio loans only
Assumption Rights
Whether a future buyer can take over your loan, and at what cost.
Not addressed
An assumable low-rate loan is a genuine asset when you sell into a higher-rate market. A non-assumable one forces the buyer to finance at market.
Typical: Usually not permitted
Subordinate / Supplemental Financing
Whether you may place additional debt behind this loan — a second mortgage, mezzanine debt, or preferred equity.
Not addressed
Determines whether you can pull equity out later without refinancing the whole stack.
Typical: Generally not permitted
Cross-Collateralization and Cross-Default
Whether multiple properties secure the same debt (cross-collateralized) and whether a default on one triggers default on all (cross-defaulted). These are separate things.
Not addressed
Cross-default without cross-collateralization is standard on credit facilities and means one bad deal can accelerate every loan you have with that lender.
Typical: Portfolio and blanket loans; release price typically 110–120% of allocated loan amount
Default Interest Rate
The rate that applies to the entire balance once the loan is in default, including at maturity.
Not addressed
A loan that reaches maturity unpaid is in default. On a bridge loan where the sale slips by a month, default interest can cost more than the extension fee you were trying to avoid.
Environmental Indemnity
A separate personal indemnity for environmental liabilities, which typically survives repayment of the loan and is carved out of non-recourse protection.
Required despite residential character
We will require an environmental indemnity notwithstanding the residential character of the property.
Typical: Often required even on residential
Prepayment
Prepayment Structure
What it costs to pay the loan off early — a step-down penalty, yield maintenance, defeasance, a lockout period, or nothing at all.
3/2/1 declining
Three-year declining penalty of 3%, 2% and 1% on prepayments exceeding 20% of the original balance in any loan year. Removing it entirely costs about three-quarters of a point in rate.
a three-year declining penalty of three percent, two percent and one percent
Typical: Step-down, commonly 5/4/3/2/1 or 3/2/1; buyout priced in rate
Lockout Period
A period during which the loan cannot be prepaid at all, at any price.
Not addressed
Not a cost but an absolute bar. If a sale opportunity appears during lockout, you cannot take it without the lender's consent.
Typical: Rare outside securitized portfolio loans
Open Period
A window before maturity during which the loan may be prepaid with no penalty.
Not addressed
Lets you line up a refinance without paying twice. Ninety days is the common convention and is usually enough; anything shorter is tight.
Reserves & Escrows
Tax and Insurance Escrow
Monthly collection of one-twelfth of annual property taxes and insurance, held by the lender.
Required, no waiver available
We escrow for real estate taxes and property insurance in all cases and there is no waiver
Typical: Generally required, often with no waiver available
Replacement / CapEx Reserve
An ongoing monthly deposit for future capital repairs, usually stated per unit per year.
Not addressed
Reduces cash flow every month and counts against your coverage. Waiver authority is often delegated to the lender, so it is negotiable more often than borrowers assume.
Typical: Portfolio loans; rare on single-asset
Liquidity / Reserve Requirement
Cash you must document and hold, usually expressed as a number of months of payments, often with a seasoning period.
9 months of PITIA
evidence of liquidity equal to nine months of PITIA, being approximately $36,945
Costs & Process
Good Faith Deposit
Money paid on acceptance of the term sheet, applied against third-party costs.
$2,500, partially refundable
Refundable only to the extent it exceeds costs actually incurred; not refundable if you withdraw after reports are ordered.
a good faith deposit of $2,500 upon your acceptance
Third-Party Report Costs
Appraisal, environmental, engineering, feasibility, and property condition reports, ordered by the lender and paid by you.
$1,100 appraisal
an appraisal fee of $1,100 for a small residential income property with rent schedule
Lender Legal Fees
The cost of the lender's counsel documenting the loan, paid by the borrower.
$950 doc prep
our counsel's document preparation fee of $950
Rate Lock
Whether and when the rate can be fixed, for how long, and what an extension costs.
Not addressed
An unlocked rate can move between term sheet and closing, and the term sheet number is often the best case. On agency deals the lock mechanics are a product feature in their own right.
Typical: 30-day lock typical, extensions priced per 15 days
Term Sheet Expiration
The date after which the offer lapses.
21 days
This indication is open for acceptance for twenty-one days
Exclusivity Clause
A commitment not to negotiate with other lenders for a stated period after accepting the term sheet.
Not addressed
Removes your leverage exactly when you need it. If the lender re-trades during underwriting, you have no alternative ready.
Typical: Sometimes present; frequently negotiable
Conditions to Closing
Everything that must be delivered or true before the lender will fund.
Not addressed
Where timelines die. A condition like "written evidence that short-term rental use is permitted" or "full permit set issued" can take weeks you have not budgeted.
Typical: Enumerated at varying length; the specific ones matter more than the count
Estimated Time to Close
How long the lender expects to take from complete submission to funding.
25–30 days
We would expect to close within twenty-five to thirty days of a complete submission.
Insurance Requirements
Coverage the lender requires — property, liability, loss of rents, builder's risk, flood, windstorm — with minimum amounts and endorsements.
Loss of rents, 12 months minimum
loss of rents coverage for not less than twelve months
Typical: Replacement cost plus 6–12 months loss of rents
Ongoing Reporting Requirements
Financial statements, rent rolls, and progress reports you must deliver after closing, and how often.
Not addressed
Administrative on its face, but late reporting is an event of default in many loan documents, and on facilities it can suspend your ability to draw.
Typical: Portfolio loans only
Property Management Requirements
Whether professional third-party management is required and whether the lender must approve the manager.
Not addressed
A requirement for third-party management adds 6–10% of gross rents as an expense, which can be the difference between clearing the coverage test and failing it.
Typical: Portfolio loans may require it; single-asset usually permits self-management
Original document text
*** SYNTHETIC EXAMPLE — NOT A REAL TERM SHEET *** Written 2026-07-26 as a test fixture. Lender, borrower, and property are fictional. Deliberately prose-heavy rather than tabular, to stress-test extraction against a term sheet that buries its terms in paragraphs. Numbers are plausible but are NOT evidence of market pricing. See source.md. ------------------------------------------------------------------------------ CEDARLINE CAPITAL PARTNERS Investor Lending Division Re: Proposed Cash-Out Refinance — 4-Unit Residential, Ohio Date: June 30, 2026 Dear Mr. Vance, Thank you for the opportunity. Following our review of the materials you provided, we are pleased to outline the terms on which Cedarline would consider the requested financing. Please note this letter is an indication of interest only and does not constitute a commitment. We would look to advance $412,500 against the subject property, a four-unit residential building held by Vance Property Group LLC. Our advance is sized to 70% of the as-is appraised value, which your broker has indicated should support approximately $589,000, though we will of course be governed by the appraisal we order. Should the appraisal come in below that figure, the loan amount will be reduced accordingly to maintain our advance rate; we do not re-trade rate on appraisal variance alone. Because this is a cash-out transaction our maximum advance is 70%, where a rate-and-term refinance would allow 75% and a purchase 80%. Pricing would be 7.625% fixed for a thirty-year term on a thirty-year amortization schedule, with the first ten years payable on an interest-only basis at your election. We would note that electing the interest-only feature improves your monthly coverage but does not change how we qualify the loan: our debt service coverage test is calculated on the fully amortizing payment regardless of whether you are actually paying principal. On the rents you have provided — $1,150, $1,150, $1,275 and $1,300 per month, aggregating $4,875 — against a fully amortizing PITIA of $4,105 per month, we calculate coverage of 1.19 times. Our program minimum is 1.15 times for cash-out at this leverage. Two matters on the rent roll require attention before we can finalize. The unit renting at $1,300 is occupied on a month-to-month basis, and we will require either execution of a twelve-month lease prior to closing or that we underwrite that unit at the lower of actual or Form 1007 market rent. Second, we require six months of seasoning of ownership before a cash-out refinance, measured from the recording date of your acquisition deed. Your records indicate acquisition in November 2025, which satisfies this. An origination fee of two percent of the loan amount, being $8,250, would be earned at closing. There is a processing and underwriting fee of $1,895 in the aggregate, an appraisal fee of $1,100 for a small residential income property with rent schedule, and our counsel's document preparation fee of $950. You would additionally bear title, escrow and recording costs in the ordinary course, along with any transfer taxes. We would collect a good faith deposit of $2,500 upon your acceptance of this letter, which is applied against third-party costs and is refundable only to the extent it exceeds costs actually incurred; it is not refundable if you withdraw after we have ordered reports. Cash proceeds to you at closing, after retirement of the existing first mortgage of approximately $268,000 and the costs described above, we would estimate in the range of $130,000 to $133,000, subject to final payoff and title figures. Prepayment protection is required and would take the form of a three-year declining penalty of three percent, two percent and one percent of the principal balance prepaid, applying to prepayments in excess of twenty percent of the original balance in any loan year. Thereafter the loan is open. We can accommodate a shorter or eliminated penalty and would quote an adjustment to rate on request; as a general matter, removing the penalty entirely costs in the region of three-quarters of a point in rate. We escrow for real estate taxes and property insurance in all cases and there is no waiver available on this program. We do not require a replacement reserve on a four-unit property. We will require evidence of liquidity equal to nine months of PITIA, being approximately $36,945, held for at least sixty days, and we will require that the property carry loss of rents coverage for not less than twelve months given the reliance on rental income. The loan will be made to your limited liability company and will be non-recourse as to repayment, save that you personally, together with any other member holding twenty percent or more, will be required to guarantee the customary carve-outs, which include fraud, material misrepresentation, misapplication of rents, security deposits or insurance proceeds, waste, and any voluntary or collusive involuntary bankruptcy of the borrower. We will require an environmental indemnity notwithstanding the residential character of the property. Closing conditions would include satisfactory appraisal with rent schedule, satisfactory review of leases and a certified rent roll, evidence that all four units are in habitable condition with no open code violations, entity documentation and good standing, insurance conforming to our requirements, and a clean title commitment. We will also require a payoff statement from your existing lender and, if applicable, a subordination or termination of any junior liens. This indication is open for acceptance for twenty-one days from the date above, after which it expires without further notice. Pricing is not locked and will be set at the time you lock, which we can do once the file is complete and the appraisal is in hand. We would expect to close within twenty-five to thirty days of a complete submission. Very truly yours, Cedarline Capital Partners Investor Lending Division
What now
Sources
This record was compiled from the public pages below. Figures reflect what each source published when it was retrieved and are not a quote — confirm current terms with the lender.
- Investor Property Loan rate card (published by Corey McGinnis) — retrieved 2026-10-25