Rental Property Financing And No Doc Investment Property Loans

This ARTICLE On Rental Property Financing And No Doc Investment Property Loans Was Written By Gustan Cho NMLS 873293

Nationwide Mortgage & Realty LLC has new Rental Property Financing And No Doc Investment Property Loans that has not been in the marketplace since the Real Estate and Market Collapse of 2008. Rental property investors can now qualify for rental property financing and no doc investment property loans where the borrower’s debt to income ratios does not matter and there are no limit on the number of rental properties the investor has on their portfolio. Down payment requirements is 20% to 30% depending on the borrower’s credit scores. The only thing that we go by is the property itself and make sure that the property cash flows. Investment Property Loans is available in all 50 states and is really popular in Chicago, Illinois as well as larger cities in Florida, Washington, Virginia, Indiana, Wisconsin, California, Georgia, Alabama, New Jersey, Kansas, Ohio, Arizona, and the rest of the nation.

Rental Properties Mortgage Loan Program

There are two types of Loan Programs:

  1. Individual or Single Property Loans: This loan program is based on 30 year fixed rate fully amortized mortgages
  2. Portfolio Investment Loans: This program is a portfolio property loan program for investors who have at least 7 plus income producing rental units where they are able to purchase multiple properties and/or refinance and/or get a line of credit or the combination of purchase/refinance/line of credit based on the equity of their investment property portfolio

Benefits Of No Doc Investment Property Loans

Here is the reason why the No Doc Investment Property Loan Program is different than any other commercial/investor mortgage program:

  • This is a no doc program where income verification is not required and it is solely underwritten based on the cash flow of the subject property
  • This unique program is underwritten based on debt coverage ratio and not based on the individual debt to income ratio
  • Unlike Fannie Mae’s 5 to 10 Financed Properties Guidelines, there is no limit on the amount of properties financed with the No Doc Investment Property Loans
  • Again, unlike traditional Investment Conventional Loans, Rental Property Financing and No Doc Investment Property Loans can be financed directly to an LLC and not only restricted to an individual borrower and co-borrowers

Single Investment Property Loans

The single investment property loan program is for both purchases and refinances.

Here are the types of properties that can be financed:

Minimum property value needs to be $100,000 and the minimum loan amount is $75,000.

Down Payment And Loan To Value Requirements

There are down payment and loan to value requirements on investment property loans. The down payment and LTV requirements is based on the borrower’s credit scores.

Here is the down payment requirements on Purchases and Refinances:

  • Borrowers with 700 credit scores and higher, 20% down payment is required on purchases and 80% LTV on refinances
  • Borrowers with credit scores between 680 and 699, the down payment required is 25% on purchases and 75% LTV on refinances
  • Borrowers with credit scores between 660 and 679, the down payment requirement is 30% and 70% LTV on refinances

Minimum credit scores to qualify for Investment Property Loans is 660 credit scores. Borrowers with under 660 can contact us and The Gustan Cho Team at Nationwide Mortgage will help them improve and boost their credit scores to a qualifying score so they can qualify for the program.

Property Debt To Income Ratio Requirements

This program is underwritten by the cash flow of the property and not the borrower and/or co-borrowers. Here is the formula of the property debt to income ratio requirements:

  • For properties where their value is $150,000 or greater, the maximum cash flow coverage requirement is 85%
  • For properties where their value is less than $150,000, the maximum cash flow coverage requirement is 70%.
  • Cash Flow Coverage is calculated by taking the PITIA and dividing it by the Gross Rents

Portfolio Lines Of Credit

The portfolio lines of credit program is for investors who have at least 7 rent producing investment units. It does not need to be 7 separate properties but rather 7 individual rent producing units. Minimum loan amount is $700,000 and investors can purchase a combination of properties with this program. If investors cannot meet the minimum loan requirement of $700,000, they can either purchase two or more investment properties or do a purchase and/or refinance or combination of the two to meet the minimum loan requirement.

Here is an example on the 7 units:

  • 7 single family homes
  • 4 duplexes
  • 2 four unit buildings

The above examples shows at least 7 or more rent producing units.

This program allows investors a blanket line of credit where they can use it anytime for any purposes they need. It can be used to purchase an investment property or to do rehab on their rental properties or any personal reasons. There is no other investment loan program like this today. Investors do need at least 7 rental producing properties with equity in order to qualify. Portfolio loans and lines of credit are for purchase and refinances or the combination of both. Investment homes does not have to be in the same state and can be located in multiple states.

Types Of Properties Eligible

The following are the types of investment properties that is eligible for the portfolio loan and blanket line of credit program:

  • Single family homes
  • Townhomes
  • Condominiums
  • Non-Warrantable Condominiums are allowed
  • Two to four unit buildings
  • 5 to 20 unit apartment buildings
  • Minimum per unit property value is $50,000 and the minimum portfolio loan and/or line of credit amount is $700,000
  • Maximum Loan To Value is 75% LTV
  • Minimum DSCR is 1.15x which is calculated by taking the NOI divided by the PI
  • At least 90% of the units needs to be occupied and rented
  • The borrower needs to be under the name of a LLC of the borrower
  • Although the borrower’s personal debt to income ratio is not required, the minimum credit score of the borrower needs to be at least 660 FICO.
  • Down Payment Requirements for purchase or loan to value for refinances depends on the borrower’s credit scores
  • Borrowers need at least a 660 for 70% LTV, 680 for 75% LTV,  and at least 700 for 80% LTV.

Qualifying For Investment Home Loans

Investors who are ready to get into the real estate market, whether new or seasoned, can now qualify for this special investment property mortgage program. To learn more about it, call Nationwide Mortgage & Realty LLC at 800-900-8569 or 262-878-1965. Investors can also text Gustan Cho for faster response on his cell at 262-716-8151. We are available 7 days a week, evenings, weekends, and holidays to take your mortgage inquiry.

 

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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