For many aspiring and seasoned real estate investors, the journey to acquiring a new property often hinges on securing the right financing. A major component of this is the interest rate you’ll pay, and investment home loan rates have their own set of rules and influences. They can seem a bit higher or more complex than what you might be used to, reflecting the unique risks and opportunities associated with investment properties. This article aims to provide clarity, breaking down why these rates differ, what economic and personal factors shape them, and how you can confidently approach lenders to find competitive terms for your next deal.
Key Takeaways
- Strengthen Your Financials for Better Loan Terms: Lenders closely examine your credit score, debt-to-income ratio, and the size of your down payment for investment properties, so focusing on these areas can help you secure more favorable rates and conditions.
- Explore Diverse Loan Options and Compare Offers: Different investment goals call for different loan types—like conventional, DSCR, or bridge loans—and actively shopping around with various lenders is essential to find the financing that best fits your needs.
- Look Beyond the Basics for Investment Success: Your financial health is crucial, but also consider how market trends, tax advantages, and smart financing strategies can shape your overall returns as an investor.
What Are Investment Home Loan Rates, Really?
So, you’re looking to finance an investment property – that’s exciting! One of the first things you’ll encounter is the interest rate, and it’s a bit different from what you might have seen for your own home. Understanding these rates is key to making smart investment decisions. It’s not just a number; it’s a reflection of how lenders view the loan and what’s happening in the broader financial world. Let’s break down what these rates actually mean for you as an investor.
How Investment Rates Differ from Your Primary Home Rate
You’ve probably noticed that mortgage rates for investment properties tend to be higher than those for primary residences. Typically, you can expect them to be about 0.5% to 1.5% more. Why the difference? Lenders generally see loans for investment properties as carrying a bit more risk. If someone faces financial trouble, the thinking goes, they’re more likely to prioritize payments on the home they live in over an investment property. This perceived increase in risk for lenders translates into a slightly higher interest rate to compensate. It’s a standard practice across the lending industry, so it’s good to factor this into your calculations from the get-go.
What Makes Investment Property Rates Go Up or Down?
Several ingredients go into the recipe for an investment property mortgage rate. Broader economic factors, like the movement of 10-year Treasury yields, play a significant role, as does general investor demand for mortgage-backed securities. Lenders also add what’s often called a “risk cushion,” which can vary based on your specific financial health.
On a more personal level, things like your credit score are a big deal – a higher score usually means a better rate. Lenders will also look at your debt-to-income ratio (lower is better here), the size of your down payment (more is often better), and your loan-to-value ratio. Even your experience as a landlord and the number of properties you already own can influence the rate you’re offered. It’s all about painting a clear picture of your reliability as a borrower for an investment venture.
What Lenders Look For: Key Factors for Investment Loans
When you’re ready to dive into real estate investing, understanding what lenders are looking for is key to a smooth financing process. Think of it from their perspective: they’re assessing the risk of lending you a significant amount of money. So, they’ll look closely at several factors to determine your eligibility and the terms of your loan. It’s not just about whether you can get a loan, but also about securing the best possible rates and terms for your investment.
At MoFin Lending, we believe in transparency, so let’s walk through the main things that will be on a lender’s checklist. Knowing these upfront will help you prepare and present the strongest possible application. From your financial health to the specifics of the property itself, each piece plays a role in the lender’s decision-making process. We want you to feel confident as you explore financing options for your next venture.
Your Credit Score: Why It’s a Big Deal
Your credit score is one of the first things lenders will check, and for investment properties, it carries even more weight. Generally, you’ll find that lenders require higher credit scores for investment loans compared to mortgages for primary residences. A strong credit score, ideally 740 or higher, signals to lenders that you’re a reliable borrower who manages debt responsibly.
A higher score doesn’t just improve your chances of approval; it can also unlock more favorable interest rates and loan terms. This means lower monthly payments and potentially significant savings over the life of your loan. If your score isn’t quite where you’d like it to be, taking steps to improve your credit before applying for an investment loan can be a really smart move.
Understanding Your Debt-to-Income Ratio
Next up is your debt-to-income ratio, or DTI. This number gives lenders a snapshot of your monthly debt obligations compared to your gross monthly income. To put it simply, it helps them see if you can comfortably handle another loan payment on top of your existing debts. For investment properties, lenders prefer a lower DTI, as it suggests you have a good handle on your finances and aren’t overextended.
Calculating your DTI involves adding up all your monthly debt payments (like mortgages, car loans, student loans, and credit card payments) and dividing that by your gross monthly income. A lower DTI indicates less risk to the lender, making you a more attractive borrower and potentially leading to better loan terms.
How Much Down Payment Do You Need?
When it comes to investment properties, be prepared for a larger down payment than you might have needed for your own home. Lenders typically require at least 20% down, and sometimes more, depending on the loan type and your overall financial picture. This is because investment properties are often seen as higher risk than primary residences.
A larger down payment does more than just meet lender requirements; it can also work in your favor. Putting more money down reduces the lender’s risk, which can often translate into a lower interest rate and more favorable loan terms. It also means you’ll have more equity in the property from day one, which is always a good thing for an investor.
Decoding Loan-to-Value (LTV)
The loan-to-value ratio, or LTV, is closely related to your down payment. It’s a percentage that compares the amount of the loan to the appraised value of the property. For example, if you’re buying a $200,000 property and make a $40,000 down payment (20%), your loan amount would be $160,000. This means your LTV is 80% ($160,000 divided by $200,000).
Lenders use LTV to assess their risk. A lower LTV (meaning a larger down payment) is generally preferred because it signifies that you have more skin in the game and the lender has less exposure if property values decline. A lower LTV can lead to better loan terms and lower interest rates, as it makes you a less risky borrower in their eyes.
Property Type & Location: Do They Change Your Rate?
Yes, the type of property you’re investing in and its location can definitely influence your loan terms and interest rate. Lenders assess the risk associated with different property types. For instance, a multi-unit property might come with slightly higher rates than a single-family home because managing multiple tenants can be seen as more complex and potentially riskier. This is a key consideration for commercial loans as well.
Similarly, the property’s location matters. A property in a high-demand rental area with strong economic indicators might be viewed more favorably than one in a less desirable or declining neighborhood. Lenders consider factors like local market conditions and potential for appreciation when setting rates for specific properties.
Your Landlord Experience: Does It Count?
If you’re not new to the landlord game, your experience can be a real asset when applying for an investment loan. Lenders often look more favorably on borrowers who have a proven track record of successfully managing rental properties. This experience suggests you understand the ins and outs of being a landlord, from tenant screening to property maintenance, which can reduce the perceived risk.
While it’s not always a deal-breaker if you’re a first-time investor, having prior landlord experience can sometimes lead to smoother approvals or even slightly better terms. If you have this experience, be sure to highlight it in your application. For those just starting, a well-thought-out property management plan can also help demonstrate your preparedness.
How Much Down Payment for an Investment Property?
Alright, let’s talk about one of the biggest questions on every real estate investor’s mind: the down payment. When you’re buying an investment property, the down payment game is a bit different than when you bought your own home. Lenders see these properties as a slightly higher risk, so they often expect you to have more skin in the game. But don’t worry, understanding the typical requirements and how your down payment influences your loan can really set you up for success. It’s all about knowing what to expect and planning accordingly.
Typical Down Payments for Different Properties
So, what’s the magic number? Generally, for an investment property, you’ll be looking at a down payment of around 20% to 25%, sometimes even more. This is a step up from the lower percentages you might see for primary residences. If you’re eyeing a multi-unit property, say a duplex or a four-plex, lenders might require that 25% or even nudge it higher to secure better loan terms.
While some lenders might go as low as 15% down for certain investment properties, putting down more can often work in your favor, especially when it comes to your interest rate and overall loan conditions. It’s always a good idea to explore different financing solutions to see what fits your specific property type and investment goals, whether it’s a fix-and-flip or a long-term rental.
How Your Down Payment Shapes Your Rate & Strategy
Your down payment isn’t just a hurdle to clear; it’s a powerful tool that can shape your entire investment strategy. One of the biggest impacts? Your interest rate. Generally, the more you put down, the lower the interest rate you’re likely to secure. This happens because a larger down payment reduces the lender’s risk. Lenders view investment properties as carrying a bit more risk – after all, if financial times get tough, a borrower might prioritize their primary home payment over an investment.
By making a larger down payment, you demonstrate financial strength and commitment, which can lead to more favorable loan terms and save you significant money over the life of the loan. It also means you’ll borrow less, building equity faster from day one and potentially improving your cash flow.
What Loan Types Can You Get for Investment Properties?
When you’re ready to finance an investment property, you’ll discover several loan types, each with its own set of rules and perks. Figuring out these options is so important for picking the one that best fits your investment plan, whether you’re aiming to quickly flip a house or build up a collection of rental units. Some loans are pretty standard, while others are tailored for more specific situations.
It really comes down to matching the loan’s features—like how long you have to pay it back, the interest rate, and what you need to qualify—to your financial goals and the kind of property you’re interested in. For example, a quick fix-and-flip project might do well with a different type of financing than a property you plan to rent out for years. Let’s walk through some of the common loan types you’ll come across. It’s a good idea to understand your financing options before you get too far into your property search.
Conventional Loans
Conventional loans are a popular choice for many real estate investors. Unlike government-backed loans, these aren’t insured or guaranteed by a federal agency. This means lenders might view them as having a bit more risk, so they often ask for a higher credit score and a larger down payment compared to what you’d typically need for the home you live in.
If your financial situation is strong, a conventional loan can be a fantastic route. They usually offer competitive interest rates and terms, and you can use them for various investment properties, from single-family homes to multi-unit buildings. Just be ready for some stricter qualification criteria, as lenders want to ensure the investment is sound.
Government-Backed Loans
You might also look into government-backed loans, like those from the Federal Housing Administration (FHA), the Department of Veterans Affairs (VA), or the U.S. Department of Agriculture (USDA). While people often think of these for primary homes, they can sometimes work for investment properties, though they usually have specific conditions.
For instance, an FHA loan can be used to buy a property with up to four units, as long as you plan to live in one of them. This strategy is often called “house hacking.” VA loans, which are available to eligible veterans and service members, can also be used for multi-unit properties if you occupy one unit. These loans often have more relaxed credit and down payment requirements, making them a good path to property ownership if you meet the specific criteria.
Portfolio Loans
Portfolio loans are a little different because the lender—often a local bank or a specialized lender like MoFin—keeps the loan on their own books instead of selling it on the secondary mortgage market. This gives them much more flexibility in setting the terms. If you’re considering an unconventional property or have a unique investment strategy that doesn’t quite fit into the standard lending box, a portfolio loan could be just what you need.
Because lenders aren’t tied to the strict guidelines of larger entities with these loans, they can often tailor the financing to your specific situation. This might mean more flexible underwriting for things like how your income is verified or the type of property itself. They’re a great option when you need a more personalized approach.
Hard Money Loans
If you’re in the fix-and-flip game or need to close a deal very quickly, a hard money loan might be on your radar. These are short-term loans, often with higher interest rates, and they’re secured by the property itself—the “hard” asset. The big plus here is speed; you can often get approval and funding much faster than with traditional loans.
Hard money loans are ideal for time-sensitive opportunities, like when you need to renovate a property quickly and resell it. Lenders tend to focus more on the property’s current value and its potential after renovation (the after-repair value, or ARV) than on your personal credit score, though your credit still matters. They aren’t a long-term solution, but they can be an incredibly useful tool for those short-term projects.
DSCR Loans
DSCR loans, which stands for Debt Service Coverage Ratio loans, are specifically created for real estate investors. What makes them unique is how you qualify: it’s based on the investment property’s ability to generate enough income to cover its own mortgage payments and other debts, rather than your personal income. This is a real game-changer if you own multiple properties or if your personal income isn’t always consistent.
To figure out the DSCR, lenders divide the property’s net operating income by its total debt service (which includes principal, interest, taxes, and insurance). A ratio above 1 means the property brings in more income than it costs. These are a popular choice for financing rental properties and can be a fantastic way to grow your investment portfolio without solely relying on your day-job income.
How to Get the Best Investment Home Loan Rates
Securing the best possible interest rate on your investment home loan can significantly impact your cash flow and overall return on investment. It’s a bit like training for a race; the more you prepare and strengthen your position, the better your outcome will be. While broader economic trends certainly play a role in setting baseline rates, you have more control than you might think. By taking proactive steps to polish your financial profile, you can make yourself a more attractive borrower in the eyes of lenders.
Lenders are essentially assessing risk when they evaluate your loan application. The less risky you appear, the more favorable the terms—including the interest rate—they’re likely to offer. This means focusing on key areas like your credit history, your existing financial obligations, and the amount of capital you’re bringing to the table. Think of it as building a strong case for why you’re a reliable investment for them. Let’s walk through some practical strategies you can use to help you qualify for those coveted lower rates. Remember, even a small percentage point difference on your loan can translate into substantial savings over time.
Improve Your Credit Score
One of the most powerful moves you can make is to work on your credit score. Lenders view a strong credit score as a key indicator of financial responsibility. For investment properties, having a high credit score, often 740 or higher, is ideal if you want to access the best rates. If your score isn’t quite in that top tier, don’t get discouraged! Start by consistently paying all your bills on time. Another good habit is to keep your credit utilization low – that’s the percentage of your available credit that you’re actually using. It’s also wise to regularly review your credit report for any errors and dispute inaccuracies promptly. These consistent efforts can really make a difference.
Reduce Your Existing Debt
Your debt-to-income ratio, or DTI, is another figure lenders look at very closely. This ratio simply compares your total monthly debt payments (like credit cards, student loans, car payments) to your gross monthly income. A lower DTI signals to lenders that you have a healthy financial cushion and aren’t overextended. To improve your DTI, focus on strategies to pay down existing debt. Even chipping away at smaller balances can help lower your DTI and present a stronger financial picture, potentially leading to a more favorable interest rate on your investment loan.
Make a Larger Down Payment
When you’re buying an investment property, the size of your down payment really matters. Generally, a larger down payment leads to a lower interest rate. This is because a more substantial down payment means you have more of your own money invested in the property from day one, which reduces the lender’s risk. While the minimum down payment for investment properties is usually higher than for a primary home, aiming to put down more than the minimum can be a smart financial strategy. It not only helps you secure a better rate but can also result in lower monthly payments.
Shop Around and Compare Loan Offers
It’s so important not to take the very first loan offer you receive. Interest rates, lender fees, and loan terms can differ quite a bit from one financial institution to another. Make it a point to shop around and compare rates from several different lenders. This could include your local bank, credit unions, and specialized investment property lenders. Getting quotes from at least three to five sources will give you a solid understanding of the current market and what you qualify for. This simple step can genuinely save you thousands over the life of your loan, making it well worth your time.
Consider Working with a Mortgage Broker
If you find the process of researching and comparing multiple loan options a bit daunting, or if you simply want to cast a wider net, working with a mortgage broker could be a great solution. A mortgage broker acts as an intermediary between you and various lenders. They can help you understand the different types of loans available, compare offers, and find lenders who specialize in financing investment properties. Brokers often have established relationships with a diverse network of lenders, some of whom you might not find on your own, potentially uncovering more competitive rates and terms that fit your specific investment goals.
What Market Trends Impact Investment Loan Rates?
Beyond your personal financial picture, broader market trends play a significant role in shaping the interest rates you’ll encounter for investment property loans. It’s not just about your credit score or down payment; the wider economic landscape truly sets the stage. Staying aware of these shifts can help you better understand the forces influencing borrowing costs and potentially time your investment decisions more effectively.
Key Economic Factors to Watch
Think of the national economy as the overall climate for interest rates. Major economic shifts, like changes in inflation or the Federal Reserve’s monetary policy, directly influence what lenders charge. When the Federal Reserve adjusts its benchmark rates, those changes tend to ripple through the financial system, affecting various loan types, including those for investment properties. For example, the NCRC Mortgage Market Analysis highlighted a period where “rising home prices and a return to historically normal interest rates” created a complex situation for investors. Keeping an eye on economic forecasts and Federal Reserve announcements can give you a valuable heads-up on potential rate movements, helping you decide when it might be the best time to secure financing for your next commercial loan.
How Housing Market Conditions Play a Role
The specific conditions within the housing market itself are another major driver of investment loan rates. This includes the balance of supply and demand for homes, current trends in property prices, and the overall pace of sales. For instance, S&P Global’s 2023 U.S. Residential Mortgage And Housing Outlook projected that “home prices falling roughly 5%” could occur if monthly declines continued. On the other hand, if mortgage rates begin to ease after reaching highs, as Freddie Mac’s December 2023 outlook suggested, it could signal a more favorable borrowing climate. Understanding these dynamics helps you assess whether it’s a buyer’s or seller’s market and how that might impact your investment strategy.
Understanding Rental Market Demand’s Influence
For investment properties intended as rentals, the strength of the local rental market is a key factor that lenders consider. When demand for rental units is high, it generally means lower vacancy rates and the potential for consistent rental income—a big plus for lenders. This strong demand can be fueled by various factors, including housing affordability challenges that make homebuying difficult for some. As S&P Global noted, “Affordability pressures on new home buyers and a relatively sound rental market could support DSCR investor loan and single-family rental issuances.” A healthy rental market can therefore make it easier to secure favorable terms for your rental loans, as lenders see a clearer path to your property generating sufficient income.
Don’t Forget: Tax Considerations for Your Loan
Alright, let’s talk about something super important but often a bit daunting: taxes. When you take out a loan for an investment property, it’s not just about the monthly payments and interest rates; there’s a whole world of tax implications that can actually work in your favor if you know what you’re doing. Think of it as another layer to your investment strategy, one that can significantly impact your bottom line and overall financial picture.
The good news is that the IRS allows investors to deduct a variety of expenses related to their rental properties. This is where things get interesting for your finances. We’re talking about deducting things like the interest you pay on your mortgage, property taxes (as long as they’re uniformly assessed), and even the costs of repairs and maintenance to keep your property in good shape. You can also often deduct operating expenses such as insurance, property management fees, and utilities if you cover them. Plus, there’s depreciation, which is a way to account for the wear and tear on your property over time. These deductions can really add up and help lower your taxable income come tax season.
Now, I won’t sugarcoat it – the tax implications of investment property loans can feel a bit complex, especially when you start looking at things like capital gains if you eventually sell. The way rental income and capital gains are treated for tax purposes is quite different for an investment property compared to your primary home, and understanding these distinctions is key. Because everyone’s situation is unique, and tax laws can change, it’s always a smart move to chat with a qualified tax advisor or CPA. They can help you make sense of it all and ensure you’re taking advantage of all the deductions you’re entitled to. This way, you can focus more on finding great investment deals and less on stressing about tax forms.
How to Pick the Right Lender for Your Investment
Finding the right lender is a key step in your real estate investment journey. It’s about more than just securing a loan; it’s about finding a partner that truly gets your goals. With so many options out there, it really helps to get familiar with what different lenders offer. This way, you can find one that aligns with your specific investment strategy and financial needs. Let’s explore a few well-known lenders and what they bring to the table, so you can make an informed choice and feel confident moving forward with your investment.
MoFin Lending
If you’re an investor who values speed, clarity, and a straightforward process, especially for short-term financing, MoFin Lending is definitely one to consider. We specialize in bridge loans for both residential fix-and-flips and commercial properties, operating as a direct lender. This means you’re working directly with the decision-makers, which really helps streamline everything and cut down on waiting times. We’re big on transparency, so you’ll always know what to expect regarding our fees, terms, and requirements from the get-go. For investors needing to move quickly on a promising deal, our efficient process and the certainty of closing we provide can be a significant advantage. This helps you secure properties without those frustrating, unnecessary delays that can sometimes cause you to miss out.
Quicken Loans
Quicken Loans, now widely known as Rocket Mortgage, is often recognized for its robust online platform and a generally user-friendly digital experience. If you’re comfortable managing your finances online and appreciate a streamlined application process, they could be a good fit for your investment property needs. They offer a variety of loan options, including both fixed-rate and adjustable-rate mortgages. This variety can be particularly beneficial for investors looking to match their loan terms to different types of property investments or financial strategies. Their emphasis on customer service, combined with their digital tools, aims to make the borrowing process as smooth as possible for investors.
LendingTree
Think of LendingTree as a financial matchmaker for your investment loan search. It’s an online marketplace where you can efficiently compare loan offers from multiple lenders all in one convenient place. This can be incredibly helpful if your top priority is to shop around and secure the most competitive rates and terms available. For real estate investors, this means you can cast a wide net and see various mortgage rate offers side-by-side. This comparison can help you pinpoint a loan that best suits your financial strategy for an investment property, ensuring you feel confident you’ve explored your options thoroughly before committing.
PennyMac
PennyMac is another lender known for offering competitive rates and a pretty broad selection of loan products suitable for investment properties. They provide choices for both conventional loans and government-backed loans, which gives investors valuable flexibility depending on their specific circumstances and the type of property they’re looking to finance. PennyMac also provides online tools and resources, which can be a great help in understanding your financing options and making decisions that align well with your long-term investment goals. If you’re looking for a lender with a diverse product suite that can cater to different investor needs, they are certainly worth checking out as you weigh your choices.
New American Funding
If a more personalized touch and dedicated guidance are high on your list when looking for an investment property loan, New American Funding is recognized for this approach. They focus on providing tailored service and offer a variety of loan options specifically designed for investment properties. For investors who might be working through the complexities of investment financing for the first time, or even for seasoned investors who simply prefer a more hands-on experience, their commitment to walking borrowers through the entire process can be very appealing. They aim to combine this supportive, customer-focused service with competitive rates, making them a solid option to consider for many investors.
Smart Strategies for Financing Your Investment Property
Securing the right financing is a cornerstone of successful real estate investing. It’s not just about getting a loan; it’s about finding a financial strategy that aligns with your investment goals, whether you’re fixing and flipping or building a rental empire. Let’s explore a few savvy approaches that can help you make smart moves with your investment properties.
Are Adjustable-Rate Mortgages (ARMs) Right for You?
Adjustable-rate mortgages (ARMs) can be tempting with their lower initial interest rates compared to fixed-rate options. This often means smaller payments at the start, which can be great for minimizing upfront costs. However, it’s crucial to remember the “adjustable” part. After an initial period, your rate can change, potentially increasing your monthly payments.
Before choosing an ARM, it’s wise to understand how they work and if they fit your plan. If you’re looking at a short-term investment, like a quick fix-and-flip, an ARM might make sense. For long-term rental properties, carefully consider if potential rate hikes could strain your cash flow.
Making Sense of Cash Offer Strategies
In a competitive market, a cash offer can make your bid stand out. Sellers often prefer them because they typically mean a faster closing process and fewer financing hurdles. If you have the cash on hand, that’s ideal. But even if not, you can still make a strong, cash-like offer.
Some investors use home equity lines of credit (HELOCs) or other liquid assets. Another excellent option, especially for properties needing quick acquisition or renovations, is a bridge loan. These short-term loans from lenders like MoFin Lending provide fast funding, allowing you to act like a cash buyer and secure the deal, then refinance into a more permanent loan.
Build a Strong Investment Portfolio
Thinking beyond just one property can be a game-changer. Building a diversified investment portfolio is a smart strategy for growing wealth and managing risk. This means considering different property types—like single-family homes, multi-unit buildings, or even commercial properties—and exploring various locations. Diversification helps protect your investments if one area of the market slows down.
To support this kind of growth, portfolio loans can be very useful. These loans often have terms tailored to your specific investment strategy, sometimes allowing you to finance several properties together. For investors focused on expanding their rental holdings, MoFin Lending offers rental loans designed to help you build and manage your growing portfolio effectively.
Related Articles
- Best Investment Property Mortgage Rates in 2025 – MoFin
- Investment Property Mortgage Rates: Your Complete Guide – MoFin
- 2025 Investment Property Mortgage Rates: A Comprehensive Guide – MoFin
- Rental Property Finance: A Comprehensive Investor’s Guide – MoFin
- Understanding Interest Rates on a Rental Property Mortgage – MoFin
Frequently Asked Questions
I’ve noticed investment property rates are higher than for my own home. What’s the main reason for that? That’s a great observation, and it’s quite common! Lenders generally view loans for investment properties as having a little more risk involved. The thinking is that if someone runs into financial difficulties, they’ll likely prioritize payments on the home they live in before an investment property. This perceived difference in risk usually translates to a slightly higher interest rate for investment loans.
I’m just starting out as an investor. How much does my lack of landlord experience really matter to lenders? It’s true that having a track record as a landlord can be a plus, but don’t let a lack of experience discourage you if you’re new to investing. Lenders look at your overall financial situation, including your credit and financial stability. Demonstrating that you have a well-thought-out plan for managing the property can also go a long way in showing lenders you’re prepared.
If I could only focus on one thing to improve my chances of getting a great investment loan rate, what should it be? If I had to pick just one, I’d say focus on your credit score. It’s a really significant factor for lenders because it gives them a snapshot of how you’ve handled credit and financial obligations in the past. Working to get your credit score in the best possible shape can truly open doors to more favorable interest rates and loan terms.
I’m looking to do a quick fix-and-flip. Are there specific loans better suited for short-term projects like this? Yes, absolutely! For time-sensitive projects like fix-and-flips where you need to move quickly, certain loan types are designed just for that. Options like hard money loans or bridge loans, such as those we offer at MoFin Lending, are often ideal because they can provide faster funding and are structured for shorter-term investment strategies.
Beyond the interest rate itself, what other financial aspects should I keep in mind when I’m looking at investment property loans? That’s a smart question! While the interest rate is a big piece of the puzzle, also consider the down payment requirements, which are typically higher for investment properties. You’ll also want to be aware of any lender fees and think about how the loan terms align with your overall investment goals, including potential tax deductions you might be eligible for.