Mortgages and Home Loans for Investment Properties in St. Louis
By: Jeremy Durham
Many people realize the importance of investing, or more so, having a diverse portfolio of investments to protect against unexpected unfavorable market conditions. While many rely solely on 401k’s, IRA’s, mutual funds, etc., another option to expand the reach of your investment portfolio is through Investment Properties. I speak with many potential clients that have a tremendous interest in getting into this line of investing but need guidance and answers to their questions. That’s why I’m here! Let’s begin by discussing the types of available financing for your investment needs. .jpeg)
- Conventional Lending – This is historically the most common method of financing for individuals interested in Turn Key Ready, Long Term Investments. Fannie Mae and Freddie Mac offer 30-year loans at competitive rates (since these are somewhat risky, income-generating properties, rates will be slightly higher than what one would expect on a personal home) and will allow you to finance up to 10 properties through conventional lending means. Down payments are required and depend on the number of units (1-4) and the number of properties you currently have financed.
- Investor Solution programs – These programs are slightly less common than conventional lending, but are very useful for the existing investor who has a very good accountant and writes off much of their earnings from their investment properties, and/or have somewhat lower credit standards than conventional programs, and/or allow for shorter terms out of bankruptcy, and/or no limit on number of properties financed, and allow for much higher loan limits than a conventional program limit of $484,350. These options also are Non-Income Qualifying as they are based on the Cash Flow of the property. This is huge for the investor that wants to build a portfolio of properties!
- “Fix & Flip” Options – These options are also referred to as Hard Money Lending. They allow for funds to purchase AND renovate the subject property all in one transaction. Down payments vary and are influenced by the number of properties that you have “flipped” in the past and your level of experience (and be prepared to prove it). Many investors also don’t wish to be involved in a longer-term loan (6 months or longer) as they want to renovate and sell. This program allows for that.
- Cross Collateralizing – You might be thinking, “I have been doing this for ten years, and I’m sick of having 8-10 loans for all of my properties.” That is why cross-collateralization options exist. When you have a significant number of properties, you can roll all of your properties into one loan and enjoy the combined and considerable equity from your combined properties. While First Integrity Mortgage does not offer This lending option yet, I can recommend one of our professional partner banks or credit unions who DO offer this lending option!
My name is Jeremy Durham, Sr. Mortgage Banker with First Integrity Mortgage Services in St. Louis, MO, and I would love to speak with you regarding your needs or questions about your options with investment properties! My contact information is jdurham@firstintegrity.com or 314-856-5626, NMLS# 989777.