Secondary Home Rate Increase

[Joe Matthews]

I just received word that Fannie and Freddie are increasing their standards for secondary home purchases. I was looking to jump into long distant investing in several months and was curious how I could counter this. Does anyone have any advice?

https://therealdeal.com/national/2021/04/01/mortgage-rates-on-second-homes-rise-as-fannie-freddie-pull-back/

Here is an article as to what’s going on. I heard through my preferred mortgage broker.

Thank you

[JD Martin]

I don't think there's any way to "counter" it unless you are paying cash, or work out some other kind of financing that is independent of F/F purchasing. You will just have to build the additional cost into your model. You can also look at commercial loans (that's what I do with my local credit union) which will be less affected by it - but will still be affected some way, as more demand may increase rates or tighten up standards.

In short, if/when you're using other people's money, then you have to build their rules into your model.