100% Investment - Can I still get 100% investment loans? The answer is yes. Although many lenders are getting rid of the programs, we as mortgage brokers have access to hundreds of lenders, so we keep all the best programs. Contact us now to inquire. [apply]
You can expect higher than normal interest rates on loans for 100% financing on investment properties. Even with the best credit, the bank is taking on additional risk because they are financing all the value of the home, and if times get rough most people will skip the payment on a second or investment home rather than miss a payment on their primary residence.
100% financing on investment properties can be done up to 4 units. However it is in most cases easier to finance a 2 unit with 100% financing. The rates are generally slightly lower on the 2 family as well.
Purchasing investment property can be a great investment and if done properly can make you quite a bit of money. This is why it is very important to find an honest, educated and hardworking mortgage broker to become familiar with you and your situation and handle all of your home financing needs. There are many people out there who are not even aware that 100% financing on a rental property is available. By choosing the right mortgage program for your rental property(ies) you will be able to maximize monthly cash flow and invest into your future as well. Consult your trusted mortgage broker now to see what you can qualify for.
Advantages of 100% financing - If you have money saved for a down payment it may not be needed. There are several advantages to taking the 100% financing, and saving your down payment. The 100% financing has become increasingly more popular and easier to obtain.
100% financing allows you to move into a home without the stress or difficulty of supplying the down payment. You also will begin to earn equity in your new home.
By using 100% financing, you can keep your money earning interest in your savings account or money market fund. You can also gain a higher tax deduction for interest paid on the loan.
By financing your home with zero money down using 100 percent financing you will be able to hold onto your money instead of tying it up into the equity of your home. This way you will be able to hold onto your money and put it away in a savings account, investment account, or any other type of account to hold onto for a "rainy day". Sometimes, unfortunate events arise and you are required to utilize some of your savings. If this money is tied up in the equity of your home, you may not be able to get it out very easily or you may have very unfavorable terms to access the money. However, if you were to keep this money in your savings account, the money would be accessible instantly. Therefore, always try to make sure that you have some savings put away somewhere and don't tie up every penny you have into the equity of your home.
100 percent financing can be beneficial to any borrower no matter how much money they have in savings. Instead of putting your money towards your home, make an investment that has a higher rate of return than the amount of interest that you are paying on your home, this way you are creating positive cash flow. With 100% financing you gain the same amount of equity if your home appreciates in value as you would by purchasing a home with a 20% down payment
From a purely financial viewpoint, when you purchase a property with 100 per cent financing you are minimizing your financial risk and shifting almost all of the risk to the lender. This concept has become very popular, especially with investors who are always looking to minimize their exposure to risk.
We don’t think that saving for a down payment should be the reason you put your dreams on hold. We can help you buy your dream home with a zero down mortgage loan. You’ll not only be able to afford a home sooner, you’ll probably be able to afford more home. With a zero down mortgage, the amount of loan you can qualify for is determined by your ability to make your monthly payments rather than how large a down payment you’ve saved. And, for most buyers, this means qualifying for a larger loan.
If you plan on using 100% financing, you need to be absolutely certain your new home will hold its value or appreciate.
Even a small decrease in value can leave you "under water", or owning more than your home is worth.
As home prices have risen, so have rents. Often, you can buy a home with 100% financing with a monthly payment that is the same or or only slightly higher than your current rent. When you calculate your income tax savings from your mortgage interest deduction, buying can cost less than renting. In addition, if you get a fixed rate mortgage, your monthly principal and interest payment is locked in for the life of the loan. Your rent, however, will increase 3% to 5% annually based on national averages.
100% financing can help you control more properties and make more in appreciation.
It has become increasingly easier for investors to qualify for 100% financing on the properties they buy. This help an investor leverage their money. The less money they have to use on each property ultimately allows them to buy more properties.
How Can I Buy My First Investment Property? - For many people purchasing their first investment property can be overwhelming. You will have many mortgage options depending on what your plans are for the property. Some of the important questions to ask yourself are:
1. How long do I want to own the property?
2. Are there any improvements needed before I can flip it, or find renters?
3. How much money do I have to put down on the purchase, or for repairs and upgrades?
4. Am I financially able to make the payments if I do not sell it in the timeframe I anticipate, or cannot find renters right away?
Once you have answered these questions your mortgage consultant will be able to present you with mortgage options that address your concerns.
The easiest way to purchase an investment home is to keep your current home and turn that into an investment property when you are ready to move or upgrade to a bigger home. This way you still have great rates and financing from your existing home loan because it was an owner occupied property when you last financed it and now you can rent the home out. You can still get the same great financing on your new home because this will be an owner occupied property. Once you have one investment property it is usually much easier to buy another. You can use the equity in one of your homes as a down payment and possibly to pay for the new home in full.
One popular mortgage for investors is the Pay Option ARM. Generally, this loan has several payment options every month including a payment that is so low it increases your balance by deferring some of the interest. If you plan to purchase, renovate, and flip a home all within a few months then you should ask your mortgage professional if a pay option ARM is right for you.
A rehab loan is a great option for investors seeking to improve their property immediately upon purchase. A rehab loan provides the funds to purchase your home and the funds rehabbing all in one loan. There is only one application, one set of fees, one closing, and one convenient monthly payment.
Do an online search for foreclosure listing, bank's REO inventory and HUD's foreclosed property listing site. Most of the time, the houses on these sites are under the fair market value. Thus, as soon as you purchase the property, you would have already built up some equity.
The amount of cash required to buy an investment property will depend on your credit history. If you have excellent credit there are lenders that will allow you to borrow up to 100% the value of the property.