Unlike most residential homes, an investment property is one that is not the owner’s primary residence, and instead is used to generate profits. If it is primarily used for revenue, a property becomes considered an investment property.
Several types of properties fall into this category: residential rental properties, commercial properties, and properties purchased with the intention to renovate it and later flip it to make a profit.
Yes. In comparison to homes purchased as the primary residence, taking out a loan for an investment properties often comes with higher interest rates and a larger down payment. It can be difficult to receive a loan on an investment property, so the borrower must be prepared to put down at least 20% of the home price as a down payment and be able to prove good credit scores.
Be able to make a sizable down payment. The more you can initially pay for a down payment, the better your interest rates will be over the course of the loan. In addition, the higher your credit score, the better interest rates you’ll receive long-term.
It is generally more difficult to qualify for a loan on investment property than it is for a primary residence. Make sure you do your research and choose a property wisely before going through the process of applying for a loan.
It is also recommended to avoid investing in any property if you have any lingering debt — be it from remaining college loans or medical bills — or you can anticipate a large expense coming quickly. Lenders want to know that you have the funds to pay off the loan, and that you will continue to do so for the years on the loan.
Contact The Kolesar Team today for any interest in becoming involved with investment property or investment property loans!
Brendan and the team are as good as it gets! I’ve done multiple transactions through them over the past 5 years now and I guarantee you will be happy you used them.Scott Brouse
We embarked on our loan process thinking we would use an out of state loan agent we had used in the past despite our real estate agents recommendation of Brendan and team. After a couple hiccups with our other our other loan agent, we called Brendan. We were so impressed from the start with his clear communication and up front information. He, Tiffiney and Shannon remained responsive and thoroughly knowledgeable of every facet of the loan process. There were no unexpected surprises, everything that was possible was communicated from the start. We had an unbelievably unstressful experience! I wish they could have handled our escrow process too. You won’t be disappointed with the service they provide.Erica Sampo
Brendan and his team were an absolute pleasure to work with. They kept me informed during every step of my home purchase. I was able to get quick answers to all of my questions. I could not have asked for a more seamless process in purchasing a home. Thank you so much for all of your teams hard work and dedication. This truly has been an excellent experience and my daughter and I are looking forward to settling into our new home. Thanks again!Greg Simpson
We cannot say enough about our real estate agent, Chris Fox, and Sean Stanfield with the Kolesar Team at Home Point Financial! Their professionalism, caring nature, extensive knowledge, and ongoing communication was impressive. Throughout our home buying process, they were extremely patient and responsive, which helped make this experience enjoyable (and definitely not stressful)! The entire team is trustworthy, and we highly recommend them for your next real estate transaction!Kelli Bremonte Cardenas
Brendan and his team were wonderful. I have never experienced a service like it. Everything was so stress free and his team were EXCELLENT with their communication. When you meet someone and they tell you “don’t worry, I’m here to handle it all” it does put you at ease and Brendan was that man! Thank you, thank you, thank you, for making my recent house purchase so easy and (dare I say it?) fun! I especially love the kooky videos they send you which explains everything in very easy to understand terms.Debbie Price