As the mortgage financing industry is constantly changing and so are certain requirements, can anyone share what the lowest down payment percentage they needed for an investment property was? Also can you share if it was through a local bank, big bank, mortgage broker or if even a special program? I feel that there may be a lot of different resources out there that I can use, but I just may not know about them. Thanks for any feedback you can provide.
Investor · Louisville, KY · Member since 2011 · 1k+ posts · 1k+ votes
9y
Hey @Howard Hebert - I've used a variety of commercial lenders for rental properties and the lowest down payment I've ever come across was 10%. This was offered as a short term promotion by a lender that I had other loans with and have done loans since. It was a one-time deal. Commercial loans tend to be 20-25 year term loans with a 5 year balloon (meaning your rate/payment structure must be redone every 5 years).
Looking at the Fannie Mae eligibility matrix, you should be able to go as low as 15% for a single family investment property and as low as 25% for a multifamily. These would be 30 year fixed loans so no rate/term restructure after a 5 year window.
These are the two most common forms of loans for investment properties that you will have access to.
An investment property that is a SFR requires 15% down and a MFR 2-4 units requires a down payment of 25%. You can go up to 2% sellers concessions for investment properties.