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Thursday, 21 October 2021 08:35

Rental Property Financing Guide

2unitsactiveWhy Invest in Rental Properties?

Real estate can be purchased for many reasons. If you are an investor, you can use real estate to protect yourself from market volatility and have many other advantages.

Being a landlord is a great way to get a steady passive income, but sometimes you need some money to move. Investment property financing can take many forms as long as the borrower meets certain criteria. Many dream of boosting investment performance owning an apartment building investment property but have credit challenges, Rental Home Financing can help.

If you do not have sufficient funds to buy a large amount of real estate, a loan may be the only option. However, you could lose your investment if the loan you get is not right for you. Here are types of loans you can use to invest in real estate.

When you contact a lender, it is vital to understand the requirements and differences between what is out there and what is in there.

What is Equity Financing?

One way to finance an investment property is to use the equity you already have in your home. Conventional financing is an option if you already own the primary residence. Conventional mortgages must comply with Fannie Mae and Freddie Mac guidelines. Fannie and Freddie only accept conventional mortgages. The loans have shorter repayment periods than traditional mortgages.

They are not supported by the federal government like FHA and VA loans. Traditional financing requires a down payment of 20%. Lenders can require up to 30% of the property to be used for investment purposes. We encourage you to take the time to see what blanket investment mortgages can do to expand your portfolio.

 

Personal Credit is Not an Issue with our Blanket Mortgage

Landlord financing without tax returns

Your personal credit history is not much of a concern for us. Your personal credit history is a personal credit score that determines whether you are eligible for a conventional loan, something our creative financing can get around with your LLC financing. Your creditworthiness is an important factor in determining the interest rate applicable to your mortgage but more important to us is the income the property is capable of generating.

Unlike Rental Home Financing, most other lenders must check the borrower's income and assets. We expect borrowers to be able to pay for their mortgage on their investment properties and their monthly rent based on future rental income. No personal tax returns needed in the calculation of debt and income. Most lenders assume that borrowers have at least most of a six-month cash reserve to cover mortgage obligations but an investment property with Rental Home Financing gives you more options including Apartment Building Loans for credit challenged investors.

 

Investment property lending

Fix & Rent vs Fix & Rent

Rebuilding a house can be more attractive than waiting for a monthly rent check. Landlords have many advantages, but also challenges.

Instead of receiving monthly rental cheques in lump sums, investors get their profits in a lump sum. Hard-money mortgages are better than traditional home loans, and we are here to help. We offer loans that are secured by the property income itself.

Credit and income are important factors for the lender, but the lender's main focus should be on the viability of the properties that it will take into account.

To determine whether you can repay the loan or not, we use the ARV of your home. One disadvantage of fixed-flip loans is their high price, adding it to a rental portfolio blanket mortgage is more of a surity for long term profits. Because of our creative financing, we provide investment property mortgages as low as 4% while other loan provider rates can be as high as 18%.

Grow Your Capital With Rent Loans

Hard money loans are available. There are advantages and disadvantages to using equity capital for real estate financing. Traditional financing can become more expensive due to closing and production costs. To secure a long-term rent or finance a move to a new home, you can tap into your equity purely using the income it can provide. When buying a second property, you could borrow up to 80 per cent of the equity property & income.

It depends on the type of credit you choose. A payout refinance has a fixed rate but extends your existing mortgage term. If the term is extended, the principal residence will be charged higher interest rates. Investment property rates are heavily depenant on the 5 year and 10 year SWAP index. We keep a live chart updated in real time, check it out, click here.


With Rental Home Financing, it is possible to find money that you can invest. Renting a property or taking on the task of remodeling the house is a risky investment, but it can yield high returns. Don't confuse potential investment returns with anything else. Grow your portfolio with a blanket mortgage, apply online now today!

 

Rental Home Financing Investment Loan Products

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Rental Home Financing
9465 Counselors Way
Suite #200,
Indianapolis, IN 46240

ABOUT US
Rental Home Financing originates commercial blanket loans with a commercial purpose and is not currently authorized to make such loans in all areas of the United States. Specific circumstances will determine whether we have the ability approve/close portfolio rental home loans in your state(s). 

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