Loans For Real Estate Investors | Curbie & Bessie Capital Investments
We work with you to customize loans that fit your specific investment parameters. Unsecured funding from Curbie & Bessie Capital Investments helps individuals, small business owners and real estate investors get up to $400,000 in cash loans.
Tips on Investment Property Loans
Ready to take that step and borrow towards real estate investing? Here is some advice:
Have money for a large down payment—you will need at least 15% to put down to obtain traditional financing on such a property, and mortgage insurance does not apply. With 25% down, you may even qualify for an even better interest rate.
Check your credit score—you could end up paying more for the same interest rate if your score is under 740 or having to accept a higher interest rate. Lenders will also want to see that you have at least six months of personal and investment-related expenses available.
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You have options—Consider a bank like New American Funding to get financing for your investment property loan rather than a big bank if you don’t have as big of a down payment as you’d like. Mortgage banks like New American Funding may have access to a wider range of loan products.
Get creative—ready to pull the trigger on an investment property with a high probability of making you a profit? Take advantage of other means of obtaining a down payment by way of a home equity line of credit, or life insurance policies.
Which loan is right for your investment?
There are a lot of different loan types out there so make sure you are armed with the information you need to make the best decision for you and your investment. Curbie & Bessie Capital Investments has broken down the different loan types for you, if you still have questions be sure to post them into our forums to get advice from other investors.
Commercial
A commercial loan is a loan for a commercial property. Alternatively, investors may take out a commercial loan on a residential property which already has several other loans. Typically, commercial lenders prioritize the property value over the borrower’s ability to pay back the loan.
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Conventional Loans
A conventional mortgage or conventional loan is any type of homebuyer's loan that is not offered or secured by a government entity, like the Federal Housing Administration (FHA), the U.S. Department of Veterans Affairs (VA) or the USDA Rural Housing Service, but rather available through or guaranteed a private lender (banks, credit unions, mortgage companies) or the two government-sponsored enterprises, the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac).
Adjustable-Rate Mortgage (ARM) A type of conventional loan, a adjustable-rate mortgage is a type of mortgage in which the interest rate applied on the outstanding balance varies throughout the life of the loan. Normally, the initial interest rate is fixed for a period of time, after which it resets periodically, often every year or even monthly.
Federal Housing Authority Loans (FHA) An FHA loan is a mortgage issued by federally qualified lenders and insured by the Federal Housing Administration (FHA). FHA loans can be used for low-to-moderate income borrowers who are unable or do not want to make a large down payment. These loans allow the borrower to borrow up to 96.5% of the value of the home (with a credit score of at least 580; otherwise, a 10% down payment is required). The 3.5% down payment requirement can come from a gift or a grant, which makes FHA loans popular with first-time homebuyers.
HomeReady A type of conventional loan, HomeReady mortgages are offered by Fannie Mae. Similar to an FHA they are meant to help low- and moderate-income borrowers buy or refinance. These loans offer reduce the typical down payment to as low as 3% and reduce mortgage insurance requirements, but they're also more flexible about allowing contributions from other people. This makes HomeReady an ideal choice if you're relying on others to help fund your home purchase. Additionally, these loans allow for private mortgage insurance (PMI) to be cancelled or removed depending on the life-time value of the loan.
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Veteran Affairs (VA) A VA loan is a mortgage loan available through a program established by the United States Department of Veterans Affairs. These loans are meant to serve service members, veterans, and eligible surviving spouses. These loans offer up to 100% financing on the value of a home along with other benefits that make the purchase of a property a low-expense.
Hard money loan
A hard money loan is a short-term and high-interest loan. Unlike traditional loans a HML is backed by the value of the real estate and not by the credit worthiness of the borrower. They are funded by private investors or companies as opposed to conventional lenders such as banks or credit unions.
Specialty Loans
Specialty loans typically come from non-bank lenders. These loans are usually for consumers and smaller businesses that can't obtain traditional commercial loans.
Personal A personal loan can be a simple way to secure cash. Typically money is borrowed from a bank, credit union, online lender or a personal lender. The loan is paid back on a short timeline with monthly installments, including interest, or structured based on negotiations in the case of a personal lender.
Fix and Flip Investment Home Loans
Many buyers do not need long-term investment home loans. Rather, they need to use a loan to buy the property, so they can sell it within a short amount of time. Some borrowers use private lenders or another specialized financing for this type of loan. A fix and flip loan is more of a short-term loan. The lender will structure these loans like this to ensure they are still profitable for their needs. This type of real estate investment financing can be harder to find from a typical bank, though.
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Key things to know about this type of real estate investment financing include:
The property secures the loan, as in all types of real estate transactions.
It can be easier to qualify for these rental property loans, but only because they are not through federal mortgage programs.
They will be more expensive. Investment property mortgage rates here are typically substantially higher, along with other fees.