Cash flow mortgages, also known as investment property loans or rental property loans, are specifically designed to help real estate investors purchase income-generating properties such as rental homes, multi-family units, or commercial buildings. These mortgages differ from traditional home loans in several ways, and prospective investors often have questions about them.
If you’re looking for a creative financing solution for your real estate investment goals, we can help. Whether a cash flow mortgage is the right fit for you or not, we’re here to help you find the financing that works for you, so contact us any time to learn more.
Interested in a cash flow mortgage for your goals? Here are some FAQS to get you started.
What is a cash flow mortgage?
A cash flow investor mortgage is a loan specifically tailored for investors who intend to purchase properties with the goal of generating rental income. These mortgages are used to finance the acquisition of investment properties and are based on the property’s income potential rather than the borrower’s personal income.
Cash flow investor mortgages work similarly to traditional home loans, but with a focus on the property’s rental income. Lenders assess the property’s potential rental income, expenses, and cash flow to determine the loan amount and terms. Investors typically make a down payment, and the property serves as collateral for the loan.
What are the eligibility requirements for a cash flow mortgage?
Eligibility requirements for cash flow investor mortgages vary depending on the lender. We look at your credit score, debt-to-income ratio, and the property’s income potential. We’re also looking for some experience with rental properties, showing your ability to manage them effectively. If you want to learn more about our eligibility requirements, reach out any time to see if this will be a good fit for you.
What type of property can I buy with a cash flow mortgage?
Cash flow investor mortgages can be used to finance various types of income-generating properties, including single-family homes, multi-family units (duplexes, triplexes, or apartment buildings), condominiums, and commercial properties such as office buildings or retail spaces.
How is the potential rental income calculated?
We will calculate rental income based on multiple factors, including comparable properties and occupancy rates. Rental income is typically used to offset the property’s expenses and debt service when determining the property’s cash flow and the borrower’s ability to repay the loan.
Working with an experienced real estate professional can help you accurately estimate the income potential of the properties you are considering. We will work as a team to support your investment goals and make sure you are financing a property with a strong potential for profitability.
What are the down payment requirement for a cash flow mortgage?
The down payment requirement for cash flow investor mortgages is typically higher than that for traditional home loans. We may require down payments ranging from 15% to 25% of the property’s purchase price, although the details are going to vary based on the type property you are buying and your unique scenario. The best way to get some solid numbers you can work with is to talk with us. We’re here to help.
When you are ready to learn more about getting approved for your investment property financing, we are here to help. Contact us any team to get started.
