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Loan Qualification For Investment Properties
Dated: September 5 2013
Owning a cash flow investment property seems to be a staple in today's real estate market. There are TV shows about investing in real estate. Whether it is buying a house at auction or investors buying dilapidated properties to fix up. Back in the early to mid 2000's it was very easy to obtain a mortgage for an investment property. Any one could by an investment property with 0 down payment and a heart beat.In today's lending practices it is not so easy. Mortgage companies would prefer investors with experience being landlords, but it is not required. These investment loans are full documentation loans. This means full tax returns, W-2's, all pages of bank statements, all pages of asset accounts and pay stubs. If you are self-employed or own your own business, plan on providing even more documentation than just mentioned.Lenders will look at the investors credit worthiness, ability to pay back the loan, assets, the concentration of rentals in the area and what they rent for.Credit score requirements for a 1 unit property are as follows. 720 credit score allows for a 15-20% down payment. If putting down 15% you have to carry a 5% second lien. The 1st lien must be 80% loan to value. 660-719 requires 25% down payment, 640-659 35% down payment. Below 640 does not qualify. Asset reserves are required as well. Each level requires a different amount of cash reserves to be verified for the full mortgage payment. PITIA. The A stands for Property association dues that have to be included as a monthly payment.720 10 months reserves for the property being purchased and 6 months for each additional property owned.660-719 6 and 6. For 640-659 3 and 6Debt to income ratio can not exceed 45% for all credit scores.If you are considering purchasing a home as an investment and you need financing it would be in your best interest before looking at homes to get pre-approved to make sure you fit these parameters. Contact us today so that we may assist you! Russell Banki 713-480-0889 www.coolhoustonhomes.com Russell Banki Owner/Realtor (CNE, ALHS) of Best Priced Properties 713-480-0889 Zing Ventures LLC
Russell Banki ALHS, CNE REALTOR Hite Properties Cell: 713-480-0889 Best Priced Properties Team Montgomery & Harris County TX Real Estate Experts Clients First!Treating the relationship with f....
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