Monday, June 16, 2008

Getting Funding for Investment Properties

One of the recent challenges we (and our clients) are facing is getting funding/financing for purchasing additional investment properties at reasonable rates. This is true even if you have great credit. Some lenders are limiting the number non-owner occupied homes they will lend money for as conforming loans. The number used to limit the number of homes to ten homes. I checked with my mortgage banker last week and he told me that the number of investment properties you can have and still benefit from having conforming loans is still technically ten according to FNMA rules, but some lenders are choking it down to four with their own internal rules. I believe this is an effort to minimize the lenders risk. The lenders no longer can tell a good risk from a bad risk so their current reaction is to overreact and go very conservative. Please call us if you are having trouble with financing, we can refer you to avenues which are very investor savvy and will be able to help identify the best place for investor loans.

It may take another year or two before things settle down, but until then you must take the time to research options and, as always, feel free to ask us. Imagine you can call someone who knows 40 different people who have procured investor financing in the last two months. Imagine that they have used a variety of methods and brokers. You do not need to imagine, this knowledge is available at Prime Properties. Also, if we refer you to a mortgage broker or mortgage banker, it is only because we have found our clients having success, it is not because we get any referral fees or other compensation.

1 comment:

Anonymous said...

No doubt you heard my recent financing story Kevin... I recently moved and had a heck of a time trying to get my loan for an owner occupied home to to through. The bank felt and treated me as if i was untruthful and trying to get an OO vs a NOO loan. The problem was they pulled this the last 4 days before closing and I didn't have a chance to go elsewhere. I'd treat lightly and plan ahead especially if you're moving your primary residence and require a loan. DSR