I Thought Refinancing Was Dead—Until I Ran the Numbers

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In This Article

If you’re holding a single-family rental right now, you’ve probably asked the same question I did: Is it even worth refinancing with rates this high?

On the surface, the answer seems obvious. Interest rates are still floating near 7%. Everyone’s waiting for the Federal Reserve to cut rates. If you are like most real estate investors, though, waiting sometimes can mean missing the opportunity right in front of you.

But here’s what most investors miss: Refinancing isn’t about rate timing, it’s about capital strategy. And in some cases, refinancing with a DSCR loan today could actually help you scale faster, grow smarter, and position yourself ahead of the next wave of opportunity.

What’s Happening With Interest Rates?

The Fed held off on cuts again, and mortgage rates remain sticky. But that doesn’t mean they’re going up dramatically, either. Most projections indicate slow, gradual declines over the next 12 to 18 months.

Translation? Rates might drop a bit, but probably not fast enough to change your whole investing life.

More importantly, DSCR loans don’t move exactly in lockstep with conventional mortgage rates. They’re tied to investor appetite and risk tolerance, which means there’s often a gap between what the headlines say and what lenders like Dominion Financial Services are offering today.

So…When Do DSCR Rates Drop?

The honest answer? We don’t know. And even if they do, it might not happen in time to fund your next deal. Some investors wait for the “perfect” rate and end up missing out on five great ones. Others lock in what works now, create cash flow, and refi again when the market shifts.

Here’s the upside: Many DSCR lenders allow future refinancing with minimal penalty, and some even offer streamlined options if rates improve. That means you can refinance now to unlock equity or exit a high-interest bridge loan, then refi again later if rates drop further.

Ensure you fully understand the terms of your loan before committing to it, as DSCR loans often have a range of prepayment penalties that impact the interest rate and monthly payment.

Should You Refinance Now or Wait?

It depends on your goals. If you’re just trying to shave off 1% to lower your monthly payment, it might make sense to wait. But if you’re trying to access trapped equity, consolidate debt, or convert a short-term loan into a long-term hold, refinancing now could be the better play.

A DSCR refinance can:

Turn a high-interest hard money loan into a 30-year fixed product.

Pull cash out to fund your next down payment.

Improve your debt service ratio for future loans.

Lock in long-term control over the asset.

So, while your monthly rate might not look perfect on paper, your overall position as an investor can improve dramatically. The debt-to-income ratio is one of the silent killers of most deals when an investor tries to finance it through their personal income, which is typical of traditional conventional loans.

Why a DSCR Refinance Still Beats The Bank

Traditional lenders often require W-2 income, tax returns, and a lengthy underwriting process. DSCR lenders? They focus on the deal itself. If the property cash flows, it qualifies.

That makes DSCR loans ideal for:

Self-employed investors who don’t have traditional income documentation but do have strong-performing properties.

Airbnb and short-term rental operators who generate seasonal or irregular income that conventional lenders might not recognize.

House hackers and mid-term rental owners who use creative strategies to maximize occupancy and revenue but don’t fit inside a bank’s underwriting box.

BRRRR method investors looking to stabilize a property after renovation and extract equity for the next project.

Portfolio builders who have hit the cap on conventional loans and want to keep acquiring without jumping through endless hoops.

DSCR loans are designed for real estate entrepreneurs who treat this like a business, not just a one-off investment. If your property produces income, you can qualify based on its performance, not your personal tax returns or job history.

Plus, with lenders like Dominion Financial Services, you get more than just a rate sheet. Dominion Financial Services offers a DSCR Price-Beat Guarantee, ensuring you are getting the best rate available today. You get certainty of close, flexible terms that reflect real investing needs and loan products built specifically for people actively growing rental portfolios, not just buying a house to live in.

Final Thoughts

Refinancing today may not yield a dreamy 4%-5% rate. However, it can provide you with leverage, liquidity, and long-term control. And that’s often more valuable than saving a point or two on interest.

The best investors don’t just wait for perfect market conditions. They make strategic moves based on where they want to go next. If refinancing now helps you acquire the next deal, strengthens your portfolio, or extends your timeline, run the numbers to see if it’s a good fit. It might make more sense than you think.

And if you’re ready to explore DSCR options, Dominion Financial Services can help you understand what’s possible today, not just what might happen tomorrow.