If you are an investor looking to add another property to your portfolio, you may find it a headache to come up with financing for the new property. Most banks do not lend a fifth mortgage if you already have four in your portfolio. This makes it hard to get subsequent financing for your additional properties.
Investors can get financing for up to 10 properties per Fannie Mae. However, banks are wary of giving out these loans because they are too risky. But a little bit of patience and professional help can get you to the right people.
The requirements for investors to get the financing needed for their multiple investment properties include:
- own five to ten residential properties that are also financed
- make a 25 percent down payment or 30 percent for properties with two to four units
- a credit score of 720
- no mortgage payments for the past 12 months
- no bankruptcies or foreclosures within the past seven years
- tax records for the last two years that show the properties’ rental incomes
- six months of PITI reserves on each of the financed properties
Another option for investors to access financing for their multiple properties is through portfolio financing. It may be hard to find lenders that offer this type of financing product but it wouldn’t be hard to qualify once you find one.
If you are familiar with the workings of the real estate industry, you can work out your connections in order to find the right one. If you turn out empty, you can inquire from your local banks or find national lenders through a broker. A non qualified loan may also be a resort for investors who have problems with their qualifications.
Finding financing for your multiple properties may be hard but it is not impossible. Begin your search here.