Mortgage Strategy For Real Estate Investment Properties


Published on

For safe real estate mortgage investment tips please visit:

  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Mortgage Strategy For Real Estate Investment Properties

  1. 1. ==== ====For more tips on Safe Mortgage Investing go ====Investment properties have historically been a safe and reliable investment strategy for manypeople. Some have purchased investment properties solely on appreciation value. Mosthowever, purchase investment properties with the strategy of having a renter pay most or all of themortgage.The U.S. housing crisis and mortgage meltdown has forced lenders worldwide to review theirlending practices and here in Canada is no different. We have always had safer lending policiesand guidelines than the U.S., however, over the past couple of years we loosened our guidelinessomewhat to allow more Canadians to purchase investment property. That is changing rapidlyand we have adopted more stringent rules.Although you can still technically purchase an investment property without a down payment, mostlenders like you to have 10% - 25% of your own money going into the purchase of an investmentproperty. Their rationale is if there is a downturn in the market or economy, an investment propertywill be much easier to default on than an owner occupied property.The big difference however is being able to purchase an investment property with a "statedincome" mortgage. A stated income mortgage is one where you dont need to prove your incomeif you are in business for yourself. We simply "state" the income needed to make the TDSR (totaldebt service ratio) work. Stated income mortgages are popular with business owners because weknow they write off as much as possible to pay the least amount of income tax but this loweredtaxable income meant they didnt qualify with traditional lenders.Stated income mortgages are now mainly used if the owner is going to live in the unit. Statedincome deals are still available with non-traditional lenders but you will find the rate to besubstantially higher.Another item lenders dont like to see are properties that are going into a "rental pool". Thissituation is commonly found at ski resorts or golf resorts or at condo complexes in destinationcities. Again, the lender rationale is rental pool properties are more likely to suffer from multiplerenters coming for just a few days. It is fine if you want to find these renters yourself, just dont letthe lender see "rental pool" on the contract of sale or MLS.If any of the above has raised a question, dont hesitate to give me a call and I will be delighted toassist. Or go to my link to find out more.[]
  2. 2. Article Source: ====For more tips on Safe Mortgage Investing go ====