If you want to venture into real estate investing but do not have enough money on hand, investment property loans might assist you in financing a property to invest. Rental property loans are being offered to purchase investment properties such as second homes, condos, multi-unit residential, or vacation properties to make a return on the investment through rental or property resale. Bluestar Mortgage provides a diversity of rental property loans to meet your needs. One option is to utilize the home equity of your house to fund the additional property you want to purchase for investment.
This is the most common type of loan for rental properties that investors use. The loan approval is solely based on the rental income that the subject property brings in therefore we do not review personal income. There is no need to submit tax returns, w-2s, or paystubs. Other properties owned by the borrower are also not considered in underwriting, so you do not need to submit all property documents (this can be painful if multiple properties are owned). DSCR loans can also be closed in LLCs or Corporations.
A conventional loan is a “full doc” loan that is available to investors. This loan is the government version of a mortgage and conforms to the guidelines set by Fannie Mae and Freddie Mac. But since this will be an investment property loan, the eligibility standards will be much more rigorous even though the procedures are almost the same in your primary home loan application. The lenders need to ensure that you are financially capable of supporting the additional property. The advantage of this loan is that it offers the lowest rate.
Hard money loans are offered by companies that aim for real estate investment and are frequently simpler and quicker to obtain than a bank loan. Usually, the basis of the loan approval depended more on the worth of the investment property instead of the investor’s revenue or credit score. This kind of investment property loan is a short-term loan intended for investors who want to buy and flip a property for profit, contrary to continuous income from rental.
Furthermore, this type of loan has a pretty high interest rate as opposed to what a traditional lender might be able to provide.
General Requirements: If you decide to secure a hard money loan, the lender’s possible consideration is the sum of equity or the initial payment you will have in the home and the amount of money you own in cash reserves. The lender might also understand the extent of your knowledge in real estate and the proposal you might have for generating revenue on the property.
Contrary to a hard money lender offered by companies, the private money loan is a private individual ready to provide money for an investor worthy of investment profit. You can ask your close family ties and friends in the same real property investment loop to search for a private lender.
Typically, this kind of loan is suited for investors who cannot be eligible for a bank loan. The eligibility criteria for this loan are usually adjustable, and the interest rate is typically favorable to the borrower.
General Requirements: Among the financing choices here, the private money loan has the most complex needed requirements to apply. At the end of the day, the connection you have with the person who provides you with the money will most matter. But still, they may require you to show proof of financial documentation to determine your capacity to pay off the loan as agreed upon.
If you are interested in an Rental Property loan, call us at: 321-400-5545 to speak with a Rental Property loan expert who can assist you in determining if a Rental Property Loan is the right option for you.