Purchasing an Investment Property

Investment properties (buying a home with the intent to lease to a tenant) are at all time highs, taking up 20% of all purchase transactions in the last 12 months. Big reason for this is that in today’s environment, the home will cash flow immediately.

Most investors are purchasing properties for $100,000 or less and paying cash for these. Here is what you need to know if you are looking to finance an investment property.

• Residential Mortgage Transactions only apply to 1-4 Unit Properties
• Lenders are typically requiring a 25% down payment
• 10% down payment options available on Fannie Mae HopePath Properties
• Non-Homestead property taxes are about 33% higher than that of a primary residence
• Tighter Underwriting requirements – Need more money in the bank after closing

We have a few years experience owning investment properties, and many more years financing these properties in Michigan. Housing affordability is at all time record levels and interest rates are near historic lows, so now is a great time to be an investor. Call us with questions!