Best Investment Property Mortgage Rates in 2025

Investment property with competitive interest rates.

Ready to turn your real estate dreams into a profitable reality? Securing the best investment property mortgage rates is crucial. It’s not as simple as finding the lowest number. Understanding how loan types, your finances, and the property itself affect those rates is key. This guide breaks down everything you need to know about getting the best deal, from understanding the factors at play to comparing lenders and crafting a winning loan application. Let’s maximize those returns!

Key Takeaways

  • Understand the factors influencing interest rates: Your credit score, down payment, and the property itself all affect the rate you’ll receive on an investment property loan. Knowing how these factors interact empowers you to negotiate effectively.
  • Explore various loan options: From conventional mortgages to portfolio loans, research the different financing options available for investment properties. Choosing the right loan type is crucial for your investment strategy.
  • Prepare your financials and property analysis in advance: Organizing your financial documents and conducting a thorough property analysis streamlines the loan application process and presents you as a serious investor.

Investment Property Interest Rates: What to Expect

Investment property interest rates are the percentage a lender charges for financing an investment property—one you plan to use for investment purposes, like renting it out or flipping it. Understanding these rates is crucial for smart decision-making and maximizing your returns. Let’s break down how they work.

Investment Property vs. Primary Residence Rates

Generally, interest rates for investment properties sit higher than those for primary residences. Lenders see these loans as slightly riskier, figuring investors might be more likely to default during a downturn than homeowners living in their property. It makes sense—someone will likely prioritize the mortgage on the roof over their head. The exact difference varies, but you can usually expect to pay between 0.5% and 1% more on an investment property loan. So, if the average rate for a primary residence is 6%, you might find rates between 6.5% and 7% for a similar investment property loan. Bankrate is a helpful resource for staying on top of current rates.

What Factors Influence Investment Property Rates?

Several factors influence the interest rate you’ll snag on an investment property loan. Your financial health plays a big role, including your credit score, debt-to-income ratio (DTI), and down payment. A higher credit score and larger down payment usually signal lower risk to lenders, resulting in better rates. The property itself matters too. The type of property (single-family, multi-unit, or commercial) and location can influence the rate. LendingTree offers a good overview of how these factors work together. Finally, broader market conditions, like prevailing interest rates and investor demand, also affect the rates lenders offer. These factors can change, so staying informed is key. For more personalized information, reach out to a lender like MoFin Lending to discuss your specific situation.

Current Investment Property Mortgage Rates

Investment property mortgage rates typically run higher than those for primary residences. This difference reflects the increased risk lenders associate with these loans. On average, expect to pay between 0.5% and 1% more for an investment property loan. For example, if the average rate for a primary residence sits around 6%, investment property rates might fall between 6.5% and 7% or higher. Your creditworthiness and the property’s specifics also play a role.

Bankrate is a great resource for staying on top of current rates. As of April 2025, they reported the national average for a 30-year fixed mortgage APR for primary residences at 6.71%, suggesting investment property rates would likely be higher. This trend holds true across the market. LendingTree notes that investment property mortgage rates usually land between 0.25% to 0.75% above those for primary residences. Keeping tabs on these resources helps you understand the current market.

Market conditions shift, so staying informed is key. Business Insider reported the average 30-year investment property mortgage rate at approximately 6.51% in February 2025, a slight dip from the previous month. For personalized guidance on navigating these rates, consider contacting a lender like MoFin Lending.

Types of Investment Property Loans

Financing an investment property requires understanding your loan options. Each has its own criteria, advantages, and drawbacks. Let’s break down some common choices:

Conventional Mortgages for Investment Properties

Conventional mortgages for investment properties are similar to those for primary residences, but often come with slightly higher interest rates and stricter qualifications. Lenders see investment properties as riskier than primary homes, so they typically require larger down payments—often 20% or more. These loans are a good option for investors with strong credit and a stable financial history. You can compare investment property mortgage rates online to get a better sense of current market offerings.

Using DSCR Loans for Investment Properties

Debt Service Coverage Ratio (DSCR) loans focus on the property’s potential profitability, not your personal income. Lenders calculate the DSCR by dividing the property’s net operating income by its annual debt service (principal, interest, taxes, and insurance). A DSCR above 1.0 indicates the property generates enough income to cover its debt obligations. These loans are attractive to investors with fluctuating or non-traditional income, as the emphasis is on the property’s cash flow.

Portfolio Loans for Real Estate Investors

Portfolio loans offer more flexibility than conventional loans because the lender holds them, not selling them on the secondary market. This allows lenders to set their own terms, making them viable for borrowers with unique circumstances or properties that don’t fit conventional loan requirements. However, this flexibility can sometimes mean higher interest rates.

Non-QM Loans: Expanding Your Options

Non-QM (Non-Qualified Mortgage) loans are an increasingly popular option for real estate investors looking to finance their properties. Unlike traditional loans, which adhere to strict guidelines set by government-sponsored entities, Non-QM loans offer greater flexibility in terms of qualification criteria. This can be particularly beneficial for investors who don’t have a conventional income stream or who have unique financial situations.

One of the primary advantages of Non-QM loans is the alternative income documentation they allow. For instance, investors can use bank statements or asset documentation instead of traditional pay stubs and W-2 forms. This flexibility opens doors for those with fluctuating incomes or self-employed individuals who might find it challenging to meet the standard requirements of conventional loans. This focus on cash flow rather than traditional income documentation often aligns well with the needs of real estate investors. LendingTree provides further information on how these loans work.

Non-QM loans also cater to a variety of property types and investment strategies, making them a versatile choice. Whether you’re financing a single-family rental, a multi-unit property, or even a commercial investment, Non-QM loans can provide the necessary funding without the stringent requirements of traditional financing. This can be especially helpful for investors interested in non-traditional properties or those pursuing strategies like bridge financing.

While Non-QM loans offer flexibility, they may come with higher interest rates compared to conventional loans. This is due to the increased risk lenders assume when providing financing without the standard qualifications. Business Insider offers insights into these potential rate differences. It’s crucial for investors to weigh the benefits against the potential costs and shop around for the best terms. Speaking with a lender, such as MoFin Lending, can provide personalized guidance.

Bridge Loans: Short-Term Financing Solutions

Bridge loans provide short-term financing to “bridge” the gap between buying a new property and selling an existing one. They’re helpful for investors who need quick access to capital, especially in competitive markets. These loans typically have higher interest rates and shorter terms than conventional loans, best suited for short-term financing needs. Bankrate offers more information on current investment property rates, including details on bridge loans.

Home Equity Options for Investment Properties

Home equity loans and Home Equity Lines of Credit (HELOCs) let you leverage the equity in your primary residence to finance investment properties. A home equity loan provides a lump sum at a fixed interest rate, while a HELOC offers a revolving line of credit with a variable interest rate. These options can offer lower interest rates than traditional investment property loans, but they put your home at risk if you can’t make the payments. You can learn more about HELOCs and how they work through the Consumer Financial Protection Bureau.

What Affects Your Investment Property Interest Rate?

Getting the best interest rate on an investment property loan can significantly impact your returns. Understanding the factors lenders consider is key to securing favorable terms. Let’s break down the key elements that influence your rate.

How Your Credit Score Impacts Your Rate

Your credit score acts as a financial snapshot for lenders. A higher credit score suggests you’re a reliable borrower, leading to more favorable interest rates. Lenders use your credit history to assess the likelihood of timely repayments. If you have a strong credit profile, you’ll likely qualify for lower rates and better loan terms. Conversely, a lower credit score might mean higher interest rates or even loan denial. Before applying for a loan, check your credit report and address any inaccuracies.

Understanding Loan-to-Value Ratio

The loan-to-value ratio (LTV) represents the percentage of the property’s value you’re financing. A lower LTV generally translates to better interest rates. For example, a 20% down payment on a $200,000 property results in an 80% LTV. Lenders view lower LTVs as less risky, as you have more equity invested in the property. A larger down payment can significantly reduce your interest rate and potentially eliminate the need for private mortgage insurance (PMI). Explore MoFin Lending’s loan programs to see how LTV impacts your options.

Debt-to-Income Ratio and Your Loan

Your debt-to-income ratio (DTI) measures your monthly debt payments against your gross monthly income. Lenders use this ratio to assess your ability to manage additional debt. A lower DTI demonstrates stronger financial health and improves your chances of securing a favorable interest rate. Managing your existing debt and ensuring your income can comfortably cover potential mortgage payments is crucial.

Property Factors That Influence Rates

The type of property and its location also play a role in determining your interest rate. Lenders often consider single-family homes less risky than multi-unit properties or commercial buildings. Similarly, properties in high-demand areas might qualify for better rates due to lower perceived risk. The property’s intended use also matters. Financing for a rental property might have different rate considerations than a property you plan to flip. Learn more about how MoFin Lending can help with various property types.

How Market Conditions Affect Your Rate

Prevailing market conditions, including interest rate trends and economic forecasts, can influence the rates offered by lenders. While you can’t control these external factors, staying informed about market trends can help you time your loan application strategically. Understanding the current market landscape can help you make informed decisions and potentially secure a more competitive rate. Contact us at MoFin Lending to discuss current market conditions and how they might affect your loan options.

Down Payment Strategies for Investment Properties

Coming up with a down payment for an investment property can feel like the biggest hurdle. But don’t let it stop you. Several strategies can make that down payment more manageable. Let’s explore some options.

Exploring Seller Financing Options

In some cases, the seller might be open to financing the purchase themselves. This is called seller financing, where the seller acts as the bank. You make payments directly to them instead of a traditional lender. This can be a win-win, especially in competitive markets or when dealing with unique properties that might not qualify for conventional financing. Seller financing can offer more flexible terms and potentially a lower down payment requirement. It’s always wise to consult with a real estate attorney to ensure all agreements are properly documented and protect your interests.

Leveraging Home Equity

If you own a home, you might be able to tap into your existing home equity to fund your investment property down payment. This can be done through a home equity loan, which provides a lump sum at a fixed interest rate, or a Home Equity Line of Credit (HELOC), which offers a revolving line of credit with a variable interest rate. While convenient for accessing funds, it’s important to remember that this strategy increases your overall debt. If property values decline, you could end up owing more than your home is worth. Proceed cautiously and make sure you understand the risks involved. You can learn more about HELOCs through the Consumer Financial Protection Bureau.

Considering Partnerships

Teaming up with other investors can be a smart way to share the financial burden of a down payment. Pooling resources not only makes the initial investment more manageable but also spreads the risk. Just be sure to clearly outline everyone’s roles, responsibilities, and financial contributions in a legally binding partnership agreement. This will help prevent misunderstandings and protect everyone involved. A well-structured partnership can be a powerful tool for achieving your investment goals.

Other Down Payment Strategies

Beyond these strategies, there are other avenues to explore. Government-backed loans, such as FHA loans and VA loans, sometimes offer lower down payment requirements—sometimes as low as 3.5% for FHA loans and 0% for VA loans for eligible veterans. Your credit score will play a role in the down payment amount required. It’s also worth exploring local and state programs that might offer down payment assistance for investment properties, especially those aimed at revitalizing specific areas. Do your research and see what programs you might qualify for. A good starting point is to connect with a local mortgage broker or lender like MoFin Lending for guidance on available options.

How to Get the Best Investment Property Mortgage Rates

Getting a favorable interest rate on an investment property loan can save you significant money over time. Here’s how to improve your chances of securing a lower rate:

Improve Your Credit for Better Rates

Your credit score is a major factor in determining the interest rate you’ll receive. A higher credit score signals to lenders that you’re a reliable borrower, making them more willing to offer better terms. Even a small increase can translate to substantial savings. Check your credit report regularly for errors and address any issues promptly. Strategies for improving your credit include paying your bills on time, keeping your credit utilization low, and avoiding opening too many new accounts at once. You can learn more about building good credit from resources like Experian.

A Larger Down Payment Can Lower Your Rate

A larger down payment reduces the lender’s risk, which can lead to a lower interest rate. If you can afford to put down more money upfront, it demonstrates your financial stability and commitment to the investment. While a 20% down payment is common, increasing it to 30% or more can significantly improve your chances of securing a more favorable rate. Explore different down payment scenarios and consider how they impact your overall investment strategy. Down payment assistance programs may be available to help you reach your down payment goals.

Lower Your Debt-to-Income Ratio

Your debt-to-income (DTI) ratio compares your monthly debt payments to your gross monthly income. Lenders use this ratio to assess your ability to manage additional debt. A lower DTI indicates a healthier financial profile, making you a more attractive borrower. Paying down existing debts, such as credit cards or student loans, can significantly lower your DTI and improve your chances of getting a better interest rate. Use a DTI calculator to understand your current ratio and identify areas for improvement.

Shop Around for Lenders

Don’t settle for the first interest rate you’re offered. Different lenders have different criteria and risk assessments, which can result in varying interest rates. Get quotes from multiple lenders, including banks, credit unions, and online mortgage providers, to compare rates and terms. This allows you to find the most competitive offer that aligns with your investment goals. Credible is a helpful resource for comparing loan offers from multiple lenders.

Negotiating with Lenders

Once you’ve gathered quotes from several lenders, don’t be afraid to negotiate. If you have a strong financial profile and competing offers, use them as leverage to negotiate a better interest rate or more favorable loan terms. Even a small reduction in your interest rate can result in substantial savings over the life of the loan. Be prepared to discuss your financial situation and investment plans with lenders to demonstrate your commitment and secure the best possible deal. A mortgage broker can also help you navigate the negotiation process.

Working with a Mortgage Broker

Engaging a mortgage broker can be a strategic move when navigating the complexities of investment property financing. Brokers have access to a wide range of lenders and can help you find the best interest rates tailored to your financial situation. They understand the nuances of different loan products and can guide you through the application process, ensuring you present a strong case to lenders.

One significant advantage of working with a mortgage broker is their ability to negotiate on your behalf. Once you’ve gathered quotes from several lenders, a broker can leverage your strong financial profile and competing offers to negotiate better interest rates or more favorable loan terms. Even a small reduction in your interest rate can result in substantial savings over the life of the loan, as highlighted in MoFin Loans’ guide on investment property mortgage rates.

Additionally, brokers can help streamline the loan application process by organizing your financial documents and ensuring you meet the necessary qualifications for various loan types. This can save you time and reduce the stress associated with securing financing for your investment property.

A mortgage broker can be an invaluable resource, especially for first-time investors or those unfamiliar with the lending landscape. They can help you navigate the complexities of investment property loans, making the process smoother and more efficient. If you’re feeling overwhelmed by the financing process, consider partnering with a broker to simplify things and potentially secure a better deal.

Hidden Costs of Financing an Investment Property

Beyond the interest rate, several other expenses can significantly impact the overall cost of your investment property loan. Understanding these upfront will help you accurately assess the true cost of financing and avoid surprises down the road. Let’s break down some key “hidden” costs:

Understanding Down Payment Requirements

Lenders often require larger down payments for investment properties than for primary residences. This is because investment properties are considered riskier—tenants may not always pay rent, and property values can fluctuate. Expect a down payment of at least 20% for single-unit properties, while multi-unit properties might require 25% or more. A higher down payment can sometimes help you secure a lower interest rate, but it also means a larger upfront investment. Learn more about how down payments affect financing.

Closing Costs and Fees to Expect

Just like with a primary residence, purchasing an investment property comes with closing costs. These include lender fees, appraisal fees, title insurance, and more. These costs typically range from 2% to 5% of the property’s purchase price. Estimate your closing costs to factor these expenses into your budget early in the process.

Property Insurance for Investment Properties

Be prepared for higher insurance premiums on investment properties. Lenders often require more comprehensive coverage than what you’d need for your own home. Landlord insurance, for example, covers property damage, liability, and lost rental income. This added protection is essential but contributes to the overall financing cost. Research current insurance requirements for investment properties.

Potential Lender Fees

Lenders sometimes charge additional fees for investment property loans, reflecting the perceived higher risk. These might include higher origination fees or points, which can add to your interest rate. Understand potential lender fees to compare loan offers effectively and choose the best financing option for your investment goals.

How Rental Income Affects Your Loan

Rental income plays a crucial role in how lenders assess your investment property loan application. They see investment properties as inherently riskier than primary residences because repayment hinges on consistent rent payments. If your tenant stops paying, your ability to repay the loan is jeopardized. This perceived risk directly influences the loan terms a lender offers. Lenders want assurance that the property can generate enough income to cover the mortgage, even with occasional vacancies.

One of the primary ways lenders evaluate this risk is through the debt service coverage ratio (DSCR). This metric compares the property’s net operating income (rental income minus operating expenses) to the total debt service (principal, interest, taxes, and insurance). A higher DSCR indicates a healthier cash flow and a lower risk for the lender, potentially leading to better loan terms. For example, a DSCR of 1.25 or higher is often required, signaling that the property generates 25% more income than needed to cover the debt service. This positive cash flow strengthens your application and can open doors to more favorable interest rates and loan amounts. Conversely, a lower DSCR might limit your options or result in higher interest rates to compensate for the increased risk. Think of it like this: the more confident the lender is in the property’s ability to generate income, the more willing they are to offer you favorable terms.

Your personal finances also factor into the equation. Lenders still consider your credit score, debt-to-income ratio (DTI), and down payment. A strong credit history demonstrates responsible financial management, while a lower DTI shows you can manage your existing debts. These factors, combined with a property that generates reliable rental income, create a compelling case for lenders. A larger down payment can also lower your loan-to-value ratio (LTV), further reducing the lender’s risk and potentially improving your loan terms. Learn more about investment property mortgage rates and how much more you might pay. Ultimately, lenders aim to balance the risk associated with the investment property with your overall financial stability. Demonstrating a clear path to profitability through consistent rental income is key to securing the best possible loan terms. Explore current investment property rates for more insights.

Refinancing Your Investment Property

Refinancing your investment property can be a smart move, especially when the market conditions are favorable. It’s all about making your current loan work better for your investment goals. Here’s what to consider:

First, keep an eye on interest rates. If rates have dropped significantly since you secured your original mortgage, refinancing to a lower rate could save you money on your monthly payments and over the life of the loan. This can free up cash flow, giving you more flexibility with your investment strategy. As Key Connection Properties points out, lower interest rates make loans more affordable and increase demand, impacting the entire market. Check out their insights on economic indicators for real estate investors.

Another reason to refinance is to tap into your property’s equity, especially if its value has appreciated. This can free up cash for renovations, down payments on other properties, or even to consolidate higher-interest debts. CBRE’s midyear market outlook highlights how refinancing can be a useful tool for accessing capital for other investments.

Timing is key. Pay attention to the overall economic climate, including Federal Reserve policies on interest rates. Understanding these broader trends can help you make informed decisions, as Loan Guys explains in their guide to timing property investments. A good time to consider refinancing is when interest rates have fallen considerably lower than your existing mortgage rate, a point echoed by Pardos Real Estate. Improving your cash flow is a major advantage of refinancing, giving you more financial breathing room for other investment opportunities or unexpected expenses.

Top Lenders for Investment Property Loans

Finding the right financing is key for any real estate investment. Here’s a look at some top lenders offering investment property loans:

MoFin Lending

MoFin Lending is a direct lender specializing in financing solutions for residential and commercial investment properties. They offer a range of loan programs designed to meet diverse investment needs, including bridge loans, rental loans, and commercial loans. What sets MoFin apart is their streamlined process, transparent fees, and reliable closings. They prioritize the income potential of the property, which can be a significant advantage for investors. If you’re looking for a direct lender with a focus on investment properties, explore MoFin’s options to discuss your financing needs.

Quicken Loans

Quicken Loans is a well-known name in the mortgage industry, recognized for its convenient online platform and competitive rates. They offer various mortgage products, including fixed-rate and adjustable-rate mortgages, catering to a wide range of investors. Their easy-to-use online application and solid customer service make them a popular choice. Visit Quicken Loans to see if they’re a good fit for your investment strategy.

LendingTree

LendingTree functions as a loan marketplace, connecting borrowers with multiple lenders. This allows investors to compare rates and terms from different sources, simplifying the process of finding the best loan. LendingTree offers a broad selection of loan types, from conventional and FHA loans to hard money loans, giving investors plenty of options. If you prefer comparing offers before making a decision, consider LendingTree.

Wells Fargo

Wells Fargo is a traditional bank offering a range of mortgage products for investment properties, including fixed-rate and adjustable-rate mortgages. They provide personalized service and a variety of financing options, making them a solid choice for investors. Their extensive branch network offers the convenience of in-person consultations. Find out more about financing with Wells Fargo.

Bank of America

Bank of America also provides competitive rates and various loan options for investment properties, including both fixed and adjustable-rate mortgages. They offer specialized programs designed specifically for real estate investors. Their online resources can help you understand your financing options and make informed choices. Learn about Bank of America’s programs to explore their investment property loans.

Choosing the Right Lender for Your Investment Property

Finding the right lender is just as crucial as securing a favorable interest rate. Different lenders have different specialties, criteria, and ways of assessing risk. This can mean a wide range of interest rates, fees, and loan terms. Taking the time to research and compare lenders is essential for any savvy investor.

MoFin Lending: Tailored Solutions for Investors

MoFin Lending is a direct lender specializing in financing solutions for residential and commercial investment properties. We offer a range of loan programs designed to meet diverse investment needs. Our streamlined process, transparent fees, and reliable closings make us a trusted partner for investors. We prioritize the income potential of the property, which can be a significant advantage. Let’s take a closer look at some of our key offerings:

Our Bridge Loan Program

Bridge loans provide short-term financing to bridge the gap between buying a new property and selling an existing one. They’re incredibly helpful for investors who need quick access to capital, especially in competitive markets. These loans typically have higher interest rates and shorter terms than conventional loans, making them best suited for short-term financing needs.

Our Rental Loan Program

With our rental loan program, the focus is on the property’s potential profitability, not solely on your personal income. Lenders calculate the Debt Service Coverage Ratio (DSCR) by dividing the property’s net operating income by its annual debt service. A DSCR above 1.0 indicates the property generates enough income to cover its debt obligations. This makes these loans attractive to investors with fluctuating or non-traditional income streams. Contact us today to learn more.

Our Commercial Loan Program

For investors looking to finance commercial properties, MoFin Lending offers commercial loans tailored to your specific needs. These loans can provide flexible terms and competitive rates, making them suitable for various investment strategies.

Other Lender Options to Consider

While MoFin Lending offers specialized programs for investors, it’s always wise to explore multiple options. Different lenders have different criteria and risk assessments, which can result in varying interest rates and terms. Get quotes from several lenders, including banks, credit unions, and online mortgage providers, to compare rates and terms. This allows you to find the most competitive offer that aligns with your investment goals. LendingTree is a helpful resource for comparing loan offers. Consider traditional banks like Wells Fargo and Bank of America, as well as online lenders like Quicken Loans. Each lender brings something different to the table, so due diligence is key.

Preparing Your Loan Application

Getting your paperwork together upfront streamlines the loan application process. Knowing what lenders look for helps you present yourself as a qualified borrower and gives you a clearer picture of your own finances and investment goals.

Required Documentation for Your Application

Lenders need a variety of documents to assess your financial health and the potential of the investment property. Be prepared to provide items like tax returns, income statements (W-2s or 1099s), and bank statements. Lenders often adhere to guidelines set by Fannie Mae and Freddie Mac, which typically involve stricter requirements and higher fees for investment properties than for primary residences. Gathering these documents early prevents delays later on.

Understanding Your Financial Statements

Your financial picture significantly impacts the interest rate you’ll receive. Lenders scrutinize your credit report and calculate your loan-to-value ratio (LTV). A solid credit score and a larger down payment generally translate to more favorable interest rates. Having organized financial statements demonstrates your preparedness and can help you secure a competitive rate.

Analyzing Your Investment Property

Before you even apply for a loan, carefully analyze the property you’re considering. This due diligence benefits both your loan application and your overall investment strategy. Understanding the property’s potential for income generation, its associated expenses, and its market value is crucial. Researching different loan options and reviewing your own financial profile will help you make informed decisions. Consider factors like 10-year Treasury yields and investor demand, which can influence rates. Bankrate offers resources to help you understand current investment property rates and trends. A thorough property analysis strengthens your loan application and sets you up for investment success.

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Frequently Asked Questions

Why are investment property interest rates typically higher than rates for primary residences?

Lenders often view investment properties as carrying more risk than primary residences. They assume if things get financially tough, borrowers will prioritize their own home’s mortgage over an investment property. This perceived higher risk translates to slightly higher interest rates, usually 0.5% to 1% more.

What type of loan is best for someone with inconsistent income but a profitable rental property?

A Debt Service Coverage Ratio (DSCR) loan might be a good fit. These loans focus on the property’s income potential, not the borrower’s personal income. If the property generates enough cash flow to cover the mortgage and other expenses, it can qualify for a DSCR loan, even if the borrower’s income is irregular.

How can I improve my chances of getting a lower interest rate on an investment property loan?

Several factors influence your interest rate. Improving your credit score, increasing your down payment, and lowering your debt-to-income ratio can all make you a more attractive borrower. Shopping around and comparing rates from different lenders is also essential for finding the most competitive offer. Don’t hesitate to negotiate with lenders to see if you can secure even better terms.

Besides the interest rate, what other costs should I consider when financing an investment property?

Factor in closing costs (typically 2% to 5% of the purchase price), higher insurance premiums for landlord insurance, and potentially larger down payments required for investment properties. Some lenders also charge additional fees for these types of loans, so compare offers carefully.

When does it make sense to refinance an investment property?

Refinancing can be a smart move if interest rates have dropped significantly since you took out your original loan. It can also be beneficial if your property has appreciated in value, allowing you to access equity for other investments or renovations. Pay attention to market conditions and consider your long-term investment goals when deciding if refinancing is right for you.

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