.png)
Apply Now For A
Rental Property Mortgage
For real estate investors seeking to acquire income-generating rental properties, our versatile rental program offers the means to rapidly expand and scale their portfolios. We handle the entire process in-house, encompassing underwriting, processing, and funding, ensuring a swift, straightforward, and dependable experience. Whether you're looking to fund a new purchase, refinance an existing property in your portfolio, or leverage the equity built in your property through a cash-out refinance, we have you covered.
RENTAL
Rental Program Details
Interest Rate:
Rates Starting at 6.875%
Qualifications:
Rent-ready and Leased Qualify
Loan Limits:
Loan Amount from $75,000 - $2,000,000
Property Type:
SFR, 2-4 Unit Multifamily and Condo / Townhomes
Credit Score (FICO):
Minimum FICO of 680
Max Loan to Value:
Up to 80% LTV
DSCR (Debt Service Coverage Ratio):
Minimum DSCR of 1.0
Loan Term:
30 Year Fixed Rate
Frequently Asked Questions
1. What is a Rental Loan?
It is a loan for real estate investors that want to invest in rental properties. The property types include single family homes, 2 -4 unit multifamily, townhomes, vacation rentals, and warrantable condos. Our long term rental financing can be structured as 30 year amortizing, ARM, or interest only options
2. What type of investment strategy can be utilized with this product?
Our term rental loan program can be used to refinance out of a hard money loan into a lower rate and longer term after the renovations are complete and it is rented out to tenants. It is a very popular investment strategy called BRRRR ( Buy, Renovate, Rent, Refinance, and Repeat) where investors will repeat this process as a way to accumulate multiple units quickly with very little money invested long term by pulling the initial money invested and using those dollars to acquire more properties. Some investors who do not plan on renovating the property and would like a loan to just purchase can acquire the property with this light documentation option that is based off of the DSCR (Debt Service Coverage Ratio).
3. How and when would you use a Rental Loan?
Each and every investment is unique. Real estate investors that are looking to own real estate long term or even short term depending on how the loan is structured with the prepayment penalty can benefit from our rental loan. We offer very competitive rates and terms for this program. Many investors want to get a loan mostly based off of the ability of the income produced by the tenants rent covering the monthly expenses. That includes the PITI (Principal, Interest, Taxes, and Insurance) payment. The loan is a "lightdoc" loan with no income verification. It is based only on the rental income covering the expenses. The minimum DSCR is usually at 1.0 - 1.2 where the rental income will have to cover all of the PITI payment and in most cases have a little extra after expenses have been paid being cash flow positive.
4. What is the "BRRRR" strategy?
This investment approach enjoys widespread popularity among investors. Through the utilization of a short-term hard money loan, investors gain the capacity to swiftly acquire properties, often within a matter of weeks or even days, circumventing many of the conventional mortgage prerequisites. The property's assessment is primarily based on its After Repair Value (ARV). Frequently, properties can benefit from enhancements, and by making strategic upgrades to both the property and its units, its value can appreciate rapidly.
Typically, the Loan-to-Value (LTV) ratio for hard money loans hovers around the "65% rule". Once the property is leased, investors often have the opportunity to refinance at a higher LTV, typically between 75% to 80%. This increased LTV can, in certain instances, enable investors to refinance not only the borrowed amount from the hard money loan but potentially also recoup the initial investment, encompassing the down payment, closing costs, and certain other associated expenses incurred during the hard money loan.
The potency of this strategy lies in the property's ability to sustain itself through rental income generated from its units. In favorable scenarios, investors can recoup their entire initial investment, ready to deploy those funds towards acquiring additional properties. This strategic approach paves the way for investors to rapidly amass a substantial portfolio and build wealth, provided it is executed effectively
5. How quickly can you close?
Our Rental / DSCR Loans can usually close in 4-5 weeks. We can close quicker with above-average response times, great organization, and preparation.