How investment property gets funded: loan products, underwriting criteria, debt service coverage, refinancing windows and the cost of borrowing short.
Agency underwriting takes 75 percent of lease or appraised rent on new acquisitions and reads Schedule E on existing holdings — and the difference between the two decides many files.
Peter Almeida
Agency cash-out refinances on investment properties top out at 75 percent loan-to-value on one unit, require six months of ownership, and price above owner-occupied deals.
Karim Al-Rashid
Owner-occupied multifamily buyers can put as little as 3.5 percent down with FHA or 5 percent down with conventional financing, provided they live in one unit for at least a year.
Karim Al-Rashid
Debt service coverage ratio loans qualify a rental purchase on the property's cash flow rather than the borrower's personal income, with pricing and equity terms that reflect the added risk.
Peter Almeida