MINT HILL, NC – As we are approaching the new year, we have been getting many inquiries about investment properties. They have ranged from, “how much money do I need for a down payment?” to “will I qualify for two mortgages?” but the real question is “how do I get started?” Well, below I will give a cliff notes synopsis on how to prepare to purchase an investment property. The absolute main thing about purchasing an investment property is credit. Many underwriting aspects are the same when it comes to investment properties, but the one aspect that can weigh the most on a non-primary residence is credit. For this to be a sound investment one will either need good credit or a very large down payment (just one, not both!)
That then leads us to our second piece – down payment. Let’s assume one has good credit, so now the second factor is location and use. Is the home right up the street that I am NEVER going to occupy, or is it at the beach, mountains, etc. that one may use for personal use as well? If it is a property, one will never occupy and rent 365 days/year, then 15-20% min. is needed. If the property is in a vacation-like area (or a good way away) and can be used for personal use, then only 10% down would be needed (i.e second home).
To recap, if one is planning for to purchase a non-primary primary residence in the New Year, the main focus should be 2 things: credit and one of the down payments mentioned (10-20%). If both can be satisfied, that goal can become a quick reality!
As always, if any questions arise, please do not hesitate to call/email/text (firstname.lastname@example.org / (704) 430-6138