Loan Scenario:

American Heritage Lending funded a $131,250 DSCR cash-out refinance on a single-family rental in Racine, Wisconsin. The home appraised at $175,000, placing the loan at 75% loan-to-value on a 30-Year term, and the numbers were exceptionally strong: a 2.253 debt-service coverage ratio, meaning the property throws off well over double the income needed to cover its payment. For a newer investor building a rental base, that kind of coverage is a foundation to build on.

DSCR financing let this deal qualify on the rental’s own cash flow rather than the borrower’s personal income, and with coverage north of 2.0 there was ample room to pull equity out while keeping the property comfortably self-supporting. The cash-out strategy here frees up capital the investor can redeploy toward the next acquisition, turning trapped equity into working funds without touching a paycheck stub.

Racine sits on the Lake Michigan shoreline, tucked between Milwaukee to the north and Chicago to the south. It carries a deep manufacturing heritage, home to the global headquarters of SC Johnson and a long industrial base that still anchors local employment. Frank Lloyd Wright landmarks and a revitalizing lakefront draw interest, while commuter access to both Milwaukee and Chicago keeps a steady pool of renters who want Great Lakes living at prices those larger cities can’t match. Affordability like this makes the buy-and-hold math work.

Strong coverage, equity unlocked, and capital freed for the next move.

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