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Investment and Second Home Loans

Opportunities abound and dreams become reality with real estate investing and second-home loans. Investing in real estate and acquiring a second home can offer personal satisfaction and great financial benefit potential!

How to Finance an Investment Property

Financing an investment property or second home has a lot of variables, starting with whether the new property will be owner-occupied or not. Consider these scenarios and types of loans available:

Conventional

A type of mortgage offered by private lenders, such as banks or mortgage companies, that is not insured by the federal government. Conventional loans are often popular because of their flexibility, with terms typically ranging from 10 to 30 years, and can be either fixed or adjustable rate. Borrowers seeking conventional loans often need to have a good credit score and a stable income.



Government loans

  • Federal Housing Administration (FHA) loans allow for lower down payments and have less stringent credit requirements compared to conventional loans.
  • Veterans Administration (VA) loans are offered to military service members, veterans, and their spouses. They typically require no down payment and offer favorable interest rates.

*FHA and VA options can cover 2-4 unit properties with owner occupancy.

Elite Mortgage Group LLC is not affiliated with an agency of the federal government, HUD or FHA.

Conventional

A type of mortgage offered by private lenders, such as banks or mortgage companies, that is not insured by the federal government. Conventional loans are often popular because of their flexibility, with terms typically ranging from 10 to 30 years, and can be either fixed or adjustable rate. Borrowers seeking conventional loans often need to have a good credit score and a stable income.

Non-QM/Portfolio Loan

A type of mortgage that doesn't meet the qualified mortgage standards set by the Consumer Financial Protection Bureau (CFPB). These loans are typically designed for borrowers who may not meet the strict criteria of traditional mortgages, such as self-employed individuals with non-traditional income sources or those with a complex financial situation. Non-QM loans often consider alternative factors for loan approval, such as bank statements, asset depletion, or higher debt-to-income ratios.

Navigate your options

We are Here for You

Investing in real estate or purchasing a second home can be a rewarding endeavor, both personally and financially. At Elite Mortgage Group LLC, we're here to guide you through the process, providing expertise in investment property financing and second-home loans. Our team understands the unique dynamics of real estate investing and can help you navigate the loan options available, ensuring you make informed decisions to unlock the full potential of your investments and second-home dreams.

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Some Key Considerations

Requirements and Guidelines

When seeking a mortgage for an additional property, such as an investment property or a second home, income and property requirements play a significant role in the qualification process.
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Start the Process

Ready to start the process of securing a mortgage for your investment or second home? Our experienced Loan Officers are here to guide you every step of the way. Reach out today and take the first step towards making your real estate goals a reality.

FAQs:

What is a Non-QM loan?
A Non-Qualified Mortgage loan is a type of mortgage that doesn't meet the qualified mortgage standards set by the Consumer Financial Protection Bureau (CFPB). These loans are typically designed for borrowers who may not meet the strict criteria of traditional mortgages, such as self-employed individuals with non-traditional income sources or those with a complex financial situation. Non-QM loans often consider alternative factors for loan approval, such as bank statements, asset depletion, or higher debt-to-income ratios.
What is a Portfolio loan?
A Portfolio loan is a mortgage that a lender keeps in its portfolio, rather than selling it on the secondary mortgage market. These loans are often offered by banks, credit unions, or private lenders, and are not subject to the same underwriting guidelines as conventional loans. Portfolio loans can be useful for borrowers who don't meet the standard requirements of traditional mortgages but have unique circumstances or non-traditional income sources. Lenders have more flexibility in setting their own criteria for portfolio loans, making them a potential option for borrowers with special financing needs.
How much of a down-payment do I need?
The required down payment amount depends on various factors, including the type of loan, the lender's requirements, and the borrower's qualifications. Conventional loans typically require a down payment of 5% to 20% of the home's purchase price. FHA loans generally have a minimum down payment requirement of 3.5%. VA loans and USDA loans may offer options for zero down payment for eligible borrowers. As your mortgage lender, we can help you determine the specific down payment requirements based on your circumstances.
Can rental income be factored into qualification?
In certain situations, rental income can be factored into qualification for a mortgage. If you're purchasing a multi-unit property and intend to rent out the additional units, the potential rental income can be considered to help meet the income requirements. However, lenders typically require a history of rental income and may apply certain guidelines for estimating and verifying rental income, such as using lease agreements or tax returns.
Can Airbnb income be factored into qualification?
The consideration of Airbnb income for mortgage qualification varies among lenders. Some lenders may consider Airbnb income if you have a consistent rental history and can provide documentation, such as tax returns or bank statements, to verify the income. The lenders that do accept Airbnb income may apply specific guidelines and requirements. As your mortgage lender, we have experience with Airbnb income and can help determine your eligibility and how the income can be factored into your qualification.