5 Ways To Get an Investment Property Loan
Traditional mortgage is totally different from getting an investment property loan. Below are top 5 time-tested and proven basic steps you need to take if you want to get an investment property loan:
This is the best thing to do- shopping around is the real deal, so that you can get the best deal. Don’t commit to a lender without investigating multiple options. This will be beneficial to you if you are looking for approval. Every lender has their own criteria, and you need to satisfy their criteria before you can get an investment property loan from them.
After engaging in multiple researches, you will most likely find a lender you are most comfortable with. At this stage, all you need to do is to apply for a loan. They will give you loan application form where you will fill your personal details such as name, current address, social security number, employment information etc. Typically, this form can be completed within few minutes.
Most lenders will like to verify the information you submit to them before taking further action. If you are applying in Melbourne for example, certainly most lenders will take a look at your credit report and ensure you have a reputable credit score. They will also verify your income level and check if you are eligible for this type of loan. If you are looking for investment property loans then you can find more information here about showing sufficient proof to the investment mortgage broker as this works a little differently to a traditional mortgage for an investment.
In this type of loan, the borrower needs to show they have the capacity to pay for both the investment property and home mortgage at the same time. Some lenders will also want to be sure you have enough cash reserve that will pay for the property for a certain months.
Look for investment partners
If you don’t have the required down payment, you can look for someone that could partner with you. This could be an easiest way to get your initial investment property. However, the only clause here is that the new investment partner will have a stake in the property.
Some lenders will want you to be ready for a down payment of at least 25% of the total sum or even 35% in some cases. This is very important because mortgage insurance does not cover investment properties.
Since this is a riskier loan, some home loan brokers such as this one will want to have some equity or insurance that that loan broker will be repaid. Thus, you are required to look for a lender that doesn’t require large down payment on the loan, though it could be rare to find one.
If you follow the above tips- shopping around, apply, verification process, down payment and looking for investment partners, surely you will get an investment property loan faster than you can ever imagine. I trust this article is helpful to your needs? Best wishes as you strive to get an investment property loan today!