How to Find the Best Refinance Loans for Investment (Non-Owner-Occupied) Properties
Financing investment (non-owner-occupied) properties has always been challenging, but the recent changes in the mortgage industry has made it even more so.
Nevertheless, borrowers who own investment real estate still do have options available for finding affordable refinance loans for their properties.
Typical Program Requirements
FHA, Fannie Mae and Freddie Mac were established to help consumers become and remain homeowners.
They weren’t created to help us become investors. That’s why although conforming programs backed by Fannie, Freddie and FHA are available, they don’t provide the breaks they offer to homeowners.
Here’s what you’ll find when you try to get financing for investment (better known as non-owner-occupied) properties:
- Lower LTV limits. Mortgage lenders require higher down payments for purchases or more equity for refinances when dealing with investment properties. Investment property mortgage loans tend to have loan-to-value (LTV) limits of 80% for single-family residences and 75% for 2- to 4-unit buildings.
- Credit. Most mortgage lenders will set a slightly higher minimum FICO scores in order to qualify for their best investment property mortgage loans.
- Income. Mortgage lenders want to see that you and rental property have the proven income neeeded to maintain the mortgage payments.
- Points. Many lenders also charge additional points and/or fees to finance investment properties.
Finding the Right Investment Property Financing for You
It all starts with comparison shopping. Use your search engine to find and investigage the best mortgage lenders in the area.
It’s a very competitive market out there, as loan officers compete for the decreased demand for mortgage services. Use one of many services now available that lets you find the right mortgage lender or loan professional.
Then remember to always ask for whatever savings or discounts you can get. You’ll be pleasantly surprised by the number of ways available to save money (or get some backfrom other consumers).
