Thursday, October 6, 2011 - Article by: William J. Acres - RPM Mortgage Inc. -
First, you cannot purchase an investment property (single family, condo, townhouse, manufactured, or 1 to 4 units), using FHA, VA or USDA loans. These programs are for owner occupied properties only. You would have to go conventional, portfolio, or hard money.
Conventional Financing requires 20% down, no mortgage insurance, and expect to pay a higher then normal rate, usually about 1.5% to 2 % above the going owner occupied rates.
Portfolio loans(sometimes referred to as Soft Money Loans) will generally do 20% down, no mortgage insurance, however, low credit scores, and property types might require higher down payment and higher interest rates, however they generally fall into same tier as conventional rates..
Hard Money loans generally require significantly higher down payments from 25% to 60%, and be prepared to pay 12% to 15% interest, and 2 to 5 points, however they will finance just about any type of credit, Good, Bad, Ugly... however the worse the credit, the higher the rate, points, and down payment requirements... WilliamAcres.com
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