Refi Window Is Cracking Open: Bridge-to-DSCR Timing After the Fed Move

If you’re holding bridge debt, the combination of a softer rate backdrop and calmer Treasury yields is your cue to prep the take-out. Here’s a practical, no-drama playbook to time your bridge-to-DSCR exit so you capture today’s pricing before spreads or appraisals drift.

Who should lean in right now

  • Rehabs 70–100% complete with punch-list items left.

  • Lease-up at 85–95% with signed rents landing this month.

  • Tight DSCR deals (1.05–1.20) that were just out of reach a few weeks ago.

  • STR portfolios where a small coupon drop flips coverage positive.

  • Rate-term refis where cash-out is optional but carry relief is urgent.

Readiness check (pass these, then move)

Property readiness

  • ✅ Final scope within budget ±5%

  • ✅ Permits/inspections scheduled (TCO or CO in sight)

  • ✅ Rent roll updated; delinquency documented

Paper readiness

  • ✅ ARV or DSCR-eligible appraisal lined up (don’t wait)

  • ✅ T-12 and current P&L cleaned and labeled (bridge vs. operating)

  • ✅ Insurance quotes ready to switch Builder’s Risk → Landlord on funding day

Borrower readiness

  • ✅ FICO verified (660+ workable; 700+ helps LTV/pricing)

  • ✅ Entity/vesting consistent from bridge to perm

  • ✅ Prepay preference chosen (3/2/1 step-down is a smart default)

The 60-day countdown (reuse this on every deal)

Day Move Why it matters
–60 Pre-qual DSCR with ±25 bp rate sensitivity Confirms exit feasibility even if markets wiggle
–45 Order DSCR appraisal; start insurance & title Collateral + binder timing are the usual bottlenecks
–30 Collect leases; clean rent roll/T-12 Underwriter wants math, not memoirs
–21 Submit full DSCR file; request float-down if offered Locks today’s window, leaves room for improvement
–14 Clear permit items; schedule final inspection Keeps appraisal and underwriting aligned
–7 Final conditions call (escrow, payoff, reserves) Avoid day-of-closing surprises
0 Fund DSCR; payoff bridge; switch insurance Carry relief starts tomorrow

Three exit tracks (pick one and drive it)

1) Rate-Term “Speed Flip”
Cosmetic rehabs with strong comps.

  • Appraisal on ARV basis if eligible

  • I/O option can lift DSCR during first year

  • Minimal docs: appraisal, title, insurance, entity

2) Cash-Out BRRRR
Hold strategy with fresh leases.

  • DSCR target ≥ 1.15

  • Clean rent roll + T-12 + PM letter

  • Consider step-down prepay to preserve future refi flexibility

3) Portfolio Ladder (4–8 doors)
Stagger 2–3 closings over 30–60 days.

  • Averages into favorable prints

  • Avoids appraisal/escrow bottlenecks

  • Simplifies 1031 or acquisition timing

Quick DSCR math

  • DSCR = NOI ÷ Annual Debt Service
    If NOI is $27,600/yr and target DSCR is 1.15, allowable annual debt is $24,000 (~$2,000/mo P&I).
    A modest coupon improvement can either:

  • Increase max loan amount, or

  • Keep loan size constant and raise DSCR (smoother underwriting).

Lock vs. float (how to decide in 3 bullets)

  • Close ≤45 days? Lock it. If available, add a float-down or pick a shorter lock with a fast close.

  • Cash-flow first? Consider ARM or I/O—often improves coverage on tight deals.

  • Future optionality? Choose a 3/2/1 step-down over a hard lockout so you can refi again if spreads compress.

Packaging tips that shave a week

  • Use a CSI-formatted budget (no “misc.” lines).

  • Label financials clearly: “Bridge Carry vs. Operating”.

  • Provide before/after photos in a simple cloud folder.

  • Confirm loss-payee language on the landlord policy

  • Keep entity names identical across appraisal, insurance, title, and loan docs.

Common speed bumps (and fast fixes)

Issue Impact Fix
Appraisal ordered too late 1–2 week delay Order at –45 days; ask for DSCR-eligible format
Insurance stuck on BR form Funding hold Bind landlord coverage effective funding day
Last-minute vesting change Redocs + title delay Lock entity early; if needed, amend every doc together
DSCR thin at current taxes/ins Proceeds cut Provide updated quotes, appeal taxes, or choose I/O

Case snapshot (illustrative)

  • Property: 4-plex, rehab 95% complete

  • Bridge: 11.0% I/O; $420k balance

  • DSCR take-out: ~7s (pricing tiered to FICO/LTV/DSCR), 30-yr fixed at 80% LTV

  • Result: Monthly debt service drops ~25–30%; DSCR rises from 1.08 → ~1.25; carry relief funds next acquisition

(Actual quotes depend on FICO, LTV, DSCR, property type, and prepay.)

Ready to capture the window?

Email your rent roll, T-12, and rehab % complete. We’ll return side-by-side DSCR options (fixed vs. ARM vs. I/O), a countdown timeline, and—if you’re on bridge—a clear payoff plan.

📞 Call LoanFunders.com | ✉️ Send your file | 🌐 Loanfunders.com
Bridge today. DSCR tomorrow. Carry relief starts the day after.