Financing out of state rental properties

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Financing out of state rental properties

Eric Stugart
Member since 2019 · 82 posts · 20 votes

I am going to be investing in out of state rental properties in the next 1-3 years.  I was wondering what kind of financing some of you experienced out of state investors use or like using to fund these investments?  What did you use on your first deal?  Is a conventional loan the best way to go?  Any and all advice would be appreciated, thank you.

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Guifre Mora
Lender · San Diego, CA · Member since 2019 · 874 posts · 355 votes
6y

Yes I do, AL & GA

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  • Matthew Irish-JonesBusiness Member
    Real Estate Agent · Buffalo, NY · Member since 2017 · 2k+ posts · 2k+ votes
    6y

    @Eric Stugart many investors are using traditional conventional residential loans. It gets a bit more tricky when you start using LLC's and need commercial financing. At that point you usually need to seek out a local portfolio lender in the area you are investing, or the area you live, and see if they will work with you. Each bank has different requirements, some banks will loan to out of state investors, and some will not.

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  • Guifre Mora
    Lender · San Diego, CA · Member since 2019 · 874 posts · 355 votes
    6y
    Originally posted by @Eric Stugart:

    I am going to be investing in out of state rental properties in the next 1-3 years.  I was wondering what kind of financing some of you experienced out of state investors use or like using to fund these investments?  What did you use on your first deal?  Is a conventional loan the best way to go?  Any and all advice would be appreciated, thank you.

    Eric,

    What's your investment strategy? Fix and Hold, Fix and Flip, Buy and hold? How much are you projecting to be able to put as a downpayment? Do you expect to have reserves in addition to the down payment if so how much?

    The quickest answer it doesn't matter if it's out of state investing buying a property is the exact same if its owner-occupied or non-owner occupied, it's about qualifying for the loan. 

    Different paperwork same process same result. 

    What today is required for mortgages may be different in 3 years. 

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  • Eric Stugart
    OP
    Member since 2019 · 82 posts · 20 votes
    6y

    @Matthew Irish-Jones Awesome, thank you for your advice! I really appreciate it!

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  • Eric Stugart
    OP
    Member since 2019 · 82 posts · 20 votes
    6y

    @Guifre Mora Thank you Guifre!  I would be doing a buy and hold, doing my best to get the best deal I could of course.  I’m glad you mentioned that it’s all the same and it only matters that you qualify for the loan that actually makes a lot of sense and clears a lot of things up!  Thank you so much!  I would be doing a conventional loan Lord willing and I would like to get in as soon as possible to a landlord friendly state with a rising housing market.  Do you invest out of state?

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  • Guifre Mora
    Lender · San Diego, CA · Member since 2019 · 874 posts · 355 votes
    6y

    Yes I do, AL & GA

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  • Eric Stugart
    OP
    Member since 2019 · 82 posts · 20 votes
    6y

    @Guifre Mora GA is actually I’m interested in! I know the market is rising! What part are you invested in?

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  • Guifre Mora
    Lender · San Diego, CA · Member since 2019 · 874 posts · 355 votes
    6y

    Rome, Morrow, Jonesboro to mention a few 

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