Guild Mortgage Inlanta works with many Investor clients to assist them in financing their portfolios of properties throughout Grand Rapids, West Michigan, Lansing, Detroit and other Michigan cities. Whether you’re a first-time investment property owner seeking to renovate, or you own several properties and would like to buy more, we’ll serve as your go-to partner to find the most innovative real estate investor mortgage programs available.
And if you’re thinking you’d like to own a second property to generate rental revenue, we know the ropes to get the right financing in place.
Real estate investment mortgages are by nature conventional products backed by Freddie Mac or Fannie Mae. One example of a popular program with generous guidelines is the Homestyle product that allows investors the rehabilitate investment properties.
Fannie Mae Homestyle Mortgage Loan
Eligible properties include:
- Principal residences, one to four units
- One-unit second homes
- Single-unit investment properties (co-ops, condos)
Manufactured or mobile homes are not eligible.
Types of renovations mortgages include:
- 15- and 30-year fixed-rate mortgages
- Adjustable-rate mortgages
Note from Fannie Mae: “The original principal amount of the mortgage may not exceed Fannie Mae’s maximum allowable mortgage amount for a conventional first mortgage.”
Qualifying and down payment requirements:
In general, investment properties require 20-25% of the purchase price as a down payment. There are many factors that can come into play including the number of units and recency as well as debt ratios and assets.
Guild Mortgage uses a combination of factors including home equity and credit to assess the cost of the loan. To get a rough estimate, combine the estimated cost of the purchase and renovation loans and divide by the total value of the property.
Unlike other loan products, HomeStyle mortgages are based on the “as completed” value after the renovations and upgrades have been made. Using improved values based on documented plans from approved contractors, HomeStyle lenders can ensure that the mortgage covers the renovations. Moreover, funds for the improvements won’t be released for homeowners/contractors until the work is certified complete by an inspection. There is no loan credit for sweat equity!