Can I use a cash-out refinance to fund my next deal with no money down?

Yes—if you own a property with significant equity, you can cash-out refinance it, pull equity as cash, and use that to fund down payment on a new property. Your first property finances the second, effectively creating a 'no money down' scenario from your personal account perspective.

What if I partner with someone else—does that enable 0% down?

No, partnerships don't eliminate the 20% down requirement. However, pooling capital with a partner makes reaching 20% down easier on larger deals. Some lenders allow one partner to hold title while another co-guarantees, offering minor flexibility in structure.

Are there private lenders offering 0% down DSCR loans?

Some private money lenders may go below 20% down, but rates will be significantly higher (10%+) and terms shorter (12 months), making it expensive capital. Direct private lenders like LYNK Mortgage offer better rates because we require standard equity cushion and can operate at scale.

DSCR Loan with No Down Payment: Is It Possible?

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Quick Facts

Minimum Down Payment

20%

Alternative: Seller Credits

Up to 2-3%

Portfolio Underwriting

Yes

Cash-Out Refi Method

Deploy existing equity

LYNK Mortgage Min Down

20%

True 0% down DSCR loans don't exist in today's market, as lenders require at least 20% equity cushion to protect against default. However, several strategies allow investors to deploy capital creatively and reduce out-of-pocket requirements, including seller financing, portfolio-level underwriting, and cash-out refinancing of existing properties.

Why 0% Down DSCR Loans Don't Exist

Lenders require down payment to create equity cushion that protects them if you default or the property loses value. In a worst-case scenario, the lender forecloses and sells the property; they want to recover the full loan balance plus costs. A 20% down payment provides that margin. DSCR loans are asset-based—they focus on property cash flow rather than your personal income—but lenders still need equity protection. Even portfolio lenders who understand long-term investor relationships won't go below 20% LTV on initial acquisitions.

Seller Credit Strategy to Reduce Cash Needed

In a competitive offer, you can negotiate seller credits toward your closing costs and down payment. Lenders typically allow seller concessions up to 2-3% of purchase price. If you're buying a $400,000 property, a 3% seller credit ($12,000) can cover much of your closing costs, freeing capital you'd otherwise spend there. This doesn't eliminate the down payment requirement, but it reduces total out-of-pocket. This strategy works best in buyer's markets or when the seller has motivation (tax loss harvesting, quick exit, portfolio reduction).

Portfolio-Level Underwriting: Leverage Existing Properties

If you own rental properties with significant equity, portfolio-level underwriting allows lenders to consider that equity when evaluating new loans. For example, if you own a $300,000 house with $150,000 equity, a lender can factor that into your overall borrower profile when you pursue a new $400,000 purchase. This strengthens your overall loan profile and can result in better LTV terms on the new property. Some lenders will go to 85% LTV on new acquisitions when strong existing portfolio performance backs them. The trade-off: lenders may require visibility into your full portfolio, so be prepared to share performance data on existing properties.

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LYNK Mortgage offers fix & flip loans, new construction loans, multi-family bridge loans, and DSCR rental loans to real estate investors.

Disclaimers: LYNK Mortgage makes loans solely for business purposes (and not for personal or consumer use) and is exempt from licensing in all states in which it operates. LYNK Mortgage does not lend on owner-occupied properties. Listed rates, terms, and conditions are offered only to qualified borrowers, may vary by loan product, deal structure, property state, or other applicable considerations, and are subject to change at any time without notice. No information on this site is intended to, or shall, create a legally binding commitment or obligation on the part of LYNK Mortgage and all terms are expressly subject to LYNK Mortgage's credit, legal, and investment approval process.

2301 Sugar Bush Road, Suite 310, Raleigh, NC 27612