Investment Property Financing
I am looking for a way to secure financing on an investment property. I have a renter that will be in place for 4 years and would like to buy an investment property under my name and lease it out. I already have a first on a personal home so I'm looking for some suggestions or lenders that would be willing to lend under these circumstances.
Thank you in advance for any help.
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#3 Private Lending & Conventional Mortgage Advice Contributor
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Brad,
If you have the down payment you can put as little as 15% down on an investment property which includes, SFR, and any 2-4 Unit Multifamily. If you do not have the down payment you can take it out of your primary that way you can use some of the equity. There are a few programs you can choose from for the purchase like Portfolio, DSCR or traditional.
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DSCR and seller financing.
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Quote from @Brad Miller:
I am looking for a way to secure financing on an investment property. I have a renter that will be in place for 4 years and would like to buy an investment property under my name and lease it out. I already have a first on a personal home so I'm looking for some suggestions or lenders that would be willing to lend under these circumstances.
Thank you in advance for any help.
Check out DSCR Loans, this article should give you a rundown of the product and if its a good fit for you!
@Brad Miller Reach out to some lenders. Your finances will depend on what makes most sense. From conventional, portfolio, DSCR, to HELOC's.
Best of luck!
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@Brad Miller - Many lenders will finance investment properties. The two things you will definitely need are decent credit scores (ideally 700 or above though you can get away with a bit lower), and cash for down payment (at least 15% plus closing costs and prepaids). Assuming you are self-employed, if you have 2 years tax returns and you're showing some income then you may be able to qualify for conventional financing. This is option 1 in my opinion as it is the more advantageous form of financing in terms of costs. If you are unable to show sufficient income, then option 2 is the DSCR loan which is underwritten based upon the subject properties income instead of your own. Option 3 is seller financing, but that is much more property/seller dependent.
Hope this helps. Feel free to reach out if you'd like more info!