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How to finance an Investment Property                                                                                                                      

How to finance an investment property is my specialty. I am an experienced property investor myself and I know how to finance an investment property through extensive knowledge of the underwriting requirements of these products. For experienced investors, there are depreciation and expense treatment methods which improve your ratios. For new investors, there are programs allowing investment in real estate with lower down payment requirements. Learn more about the power of how to finance an investment property with interest only financing

Programs fall into two categories: Fannie & Freddie and our Investor Specialty Programs. 

Investment property loans sold to Fannie Mae or Freddie Mac require a down payment ranging from 10% to 25% with a delivery fee ranging from 1.5 to 3 points. Please understand that these fees are imposed by Fannie and Freddie and are not charges from either your lender or your broker. However, the fee allows using conventional rates and loan limits. These conforming loans are available as either fixed rate or an ARM. Even with the delivery fees, these loans can be a good choice if your goals are to maximize cash flow and you plan to hold the property for a 3 to 5 year period. Ratios are normally 28/36, but with automated underwriting, Excellent credit and some liquid reserves, it is not uncommon to see back ratios in the middle 40s. Rental income is decreased by a 25% vacancy factor but there are underwriting methods which eliminates this issue for experienced investors.

The Investment Property Loan Specialty program (actually a growing group of investor loan programs) allows purchase or refinances with only 5% equity. The program allows up to 20 properties plus your home. Available up to $1,000,000 and 2-4 unit properties are acceptable. Ratios are generally 34/40 and a No Documentation program is available. Available as a fixed or adjustable rate in many reduced down payment scenarios. Most of the loans we are currently doing are set up as interest only rather than as a fully amortizing loan to improve your cash flow.

NEW! 100% investment property financing is now available with fairly reasonable rates. These programs have been available for a while, but at extremely high rates compared to market rates. We finally have a source of financing that will allow you to acquire property with limited out of pocket costs. 

I have an investor loan based on the LIBOR or MTA indexes. The LIBOR (London Interbank Offered Rate) Index is more stable than the COFI index (Cost of Funds Index). Comparison charts between the COFI, LIBOR and MTA indexes are available. One feature of the program is four repayment options. You can decide to amortize the loan for 30 or 15 years, a minimum amount, or interest only. You can choose every month and have the flexibility to manage cash flow as never before!

In 2008, Short Sales are where most of the action in real estate is. Learn more about Short Sales

I have a page on how to calculate your qualification ratios.

I have a page on documentation requirements.

Limited and No Documentation loans are now available for investment properties.

If you are looking at foreclosure property, I have a free report available by email.

Here are my thoughts on the difficulty of "flipping" income properties.

For the the greatest flexibility and maximum loan qualifying ratios, you may be interested in the Cash Flow ARM.

New! I have added a page on how to properly compare different investment property that may be helpful to you.

Learn about closing in an LLC

As a Certified Mortgage Planning Specialist, I offer an analysis of your situation today can make suggestions on how small changes in how your debt is structured today can have a life changing effect in the years to come.  Read more about this free, no obligation service.

How to Finance an Investment Property Prequalify for  How to Finance an Investment Property

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