Investment Property Mortgages
1) Amortization periods up to 35 years, with Variable and Fixed Rate Mortgages Permitted
2) Great Rates, quite close to the best rates possible
3) Loan to Value ratio of 80% on 1-4 unit Rental Properties
The Investment Property Program for Borrowers:
1) The convenience of one mortgage and one monthly payment. You can purchase an investment property in a very cost-effective manner
2) Benefit from competitive interest rates and no application fees
3) Have payment flexibility when you extend your mortgage by Refinancing or purchasing an investment property. This product allows for a LTV up to 80%
20% Traditional Down Payments on Investment Mortgages
If clients are able to put a minimum of 20% down, purchasers will have a large variety of mortgage options available to them. Conventional mortgages with 20% down, no Mortgage Insurance will be required.
Mortgage Rates and Rental Products
Most Lenders will offer their best rates. Also, if you have good credit, a solid income, with 20% or more to put down, you will qualify for a 35 year amortization mortgage.
The minimum requirement for net worth will vary depending on the lending institution. Some institutions will offer a 1.10% debt coverage ratio, and others lenders will rely on a rental off set for qualifying purposes. The debt coverage ratio of 1.10% is calculated by the Net Operating Income divided by the Debt Service.
When a Rental off set is used by lender it refers to using upwards of 70% of the rental income and off-setting it against the P.I.T. (Principal, Interest, and Taxes). Only the shortfall gets included into the debt ratio, while a rental surplus gets added back to the client's income. For instance, let's assume the rental property has a rental income of $1800 and the P.I.T. is $1324. We calculate 70% of the $1800 income, totaling $1280. The $1280 is deducted from the P.I.T. of $1324. The remaining $44 is considered a shortfall and will be added to the Debt Ratio.