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We are purchasing an investment property in Florida and would really like to find someone that is educated in investment property mortgages. It seems like either people don't do them, or they don't know much about them.
We're out there, but I'm not in your state. After the mortgage crisis hit, investment financing standards were the first to see a major tightening. If you are a first time investor, be prepared to put a minimum of 20% down (but a better rate at 30% down). First time investors cannot use the potential rent to offset the mortgage payment. First time investors are going to need at least 6 months payments in reserves (money in the bank) for the property and you will be required to carry rent loss insurance. Be prepared to pay more for the appraisal - which will require an Income Analysis and a Rent Comp Schedule. Ratios are a bit more restrictive.
If you have a history as a landlord, it's a whole new ballgame. Your tax returns are used for your income/loss on the properties you own and Schedule E is the tool used (net income + depreciation for 2010 and 2009 divided by 24 months). If the answer is a positive number, it's income, if it's negative, it's a loss). The mortgage payment for each property on Schedule E is not counted in the debts when running ratios because it's already in the expenses.
Now, that's for Fannie or Freddie lending, which is most lenders. Your regional banks may have pockets of portfolio money (I only know one tune). On our portfolio money, we will count rent to offset PITI, even for first time buyers. Call around, be specific, "do you have any portfolio programs available for residential investors?" If you get someone that sounds new, hang up and call a different number and ask for a loan officer.
If you decide to buy a Fannie Mae HomePath approved property, you can put 10% down as an investor with no PMI. The offset is a slightly higher interest rate, I've seen it any where from .25% to .75% difference depending on the timing. Most lenders do HomePath loans and your realtor should be able to search for those properties easily.
I forgot to mention....FL still has a scarlet letter on it's forehead. Many of the major investors are still not lending in Florida for investment homes.
I'd like to see an update on this topic since the market seems to be turning around. I am looking for a mortgage for an investment property and would like to find a company that specializes in that.
I own a few properties....was curious if I could use a Heloc I have on one as a down payment for another.
thanks all
I had a great experience with Chase commercial lending for an investment property, they just looked at the building stats and would lend up to 75% of the appraised value. I looked at a bunch of other banks, but they all had more requirements and/or higher rates.
I had a great experience with Chase commercial lending for an investment property, they just looked at the building stats and would lend up to 75% of the appraised value. I looked at a bunch of other banks, but they all had more requirements and/or higher rates.
What are stats, lease agreement? Did you need to submit tax returns and bank statements? Were you able to get a fixed rate loan?
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