What Are Investment Home Loans

Investment Properties

Investment Home Loans

Investment home loans are mortgage loans for those homeowners who already have a primary residence and possibly a second home.  If a homeowner already owns a home and wants to purchase a second home, he or she can get a second home or vacation home loan.  A second/vacation home loan mortgage rates are comparable to first home mortgage rates.  However, on investment home loans, mortgage rates are about 0.50% higher than first home or second/vacation home mortgage rates.

 Second Home Financing

Those who are interested in purchasing a second/vacation home that is nearby their primary owner occupied  home, might not qualify for a second/vacation home mortgage loan.  Although it is only a second home or vacation home, the mortgage lender will consider it as an investment home due to the closeness from the primary residence.  For it to be considered a second/vacation home, the home needs to be at least 60 miles or more from the primary residence or if it is closeby the primary home, it needs to be waterfront or have some unique features to be classified as a second home.  If this is the case, the home buyer would need investment home loans and not second/vacation home loans.

Down Payment Requirement On Investment Home Loans

Minimum down payment for investment home purchase:  Minimum down payment for investment home loans are 20%.  With 20% down payment, the home buyer will qualify for an investment home loan.  Investment home loans are conventional loans and fall within Fannie Mae underwriting guidelines.

Can I use the potential income of the investment home to qualify?   

If you have a higher debt to income ratio, you might not qualify for another property such as an investment home if you cannot use the potential investment home income to offset your high debt to income ratio.  The good news is that you can use 75% of the potential gross monthly rental income to offset your high debt to income ratio if and only if you put 25% down payment.  Not many lenders will offer this program but I do have a few select lenders that allow 75% of the monthly gross rental income to be use for investment home loans.

Questions on investment home loans?

If you have questions on investment home loans in California,  Illinois, and Florida, please contact Gustan Cho at 262-716-8151 or email us at gcho@gustancho.com.  You can also subscribe to our daily mortgage and real estate newsletter at www.gustancho.com .

Hard Money Lenders For Investment Home Loans

Gustan Cho Associates is the parent company of Hard Money Capital Group , a national private money direct commercial lender.  Hard Money Capital Group, www.hardmoneycapitalgroup.com , specializes in fix rehab flip loans .  Borrowers seeking short term bridge investment home loans can contact Hard Money Capital Group.  Minimum down payment on hard money loans are 35% down payment and the borrower’s credit is not an issue.  Website for Hard Money Capital Group is www.hardmoneycapitalgroup.com.

Related> Hard Money Capital Group

Related> What Are Hard Money Loans?

Related> Can You Qualify For Hard Money Loans With Recent Bankruptcy?


The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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