Investment Property Loans

Financing solutions for rental properties and real estate investments

Minimum Credit Score

640 (680+ recommended)

Down Payment

15% to 25%

Typical Timeline

30 to 45 Days

Overview

Investment property loans are specifically designed for purchasing rental properties, vacation homes, or properties intended to generate income. These loans recognize the unique nature of investment real estate and provide financing options for both experienced investors and those just starting to build their real estate portfolio.

Investment property loans typically require larger down payments and have stricter qualification requirements than primary residence loans, as lenders consider them higher risk. However, rental income from the property can often be used to help qualify for the loan, making it possible to leverage real estate for wealth building.

Key Benefits

Build wealth through real estate
Generate passive rental income
Potential tax benefits and deductions
Rental income can help qualify for loan
Portfolio diversification
Appreciation potential
Multiple property financing available
DSCR loans available (no income verification)

Who Qualifies?

Investors with a minimum 15% to 20% down payment
Borrowers with strong credit (typically 680+ for best terms)
Those who can show adequate reserve assets
Borrowers who qualify via standard income OR via property cash flow (DSCR)

Requirements

Down payment typically 15-25%
Credit score usually 620-680 or higher
Cash reserves for 6-12 months of payments
Debt-to-income ratio requirements (or DSCR ratio)
Property appraisal and rent schedule
Investment property experience may be required
Higher interest rates than primary residence loans
Rental income documentation or projections

Pros & Cons

Advantages

Allows you to build scalable wealth and passive rental income
Projected rental income from the subject property can be used to help you qualify
Interest and depreciation are often tax-deductible (consult a CPA)

Drawbacks

Interest rates are higher than primary residence loans
Requires significant down payments (no 3% down options)
Typically requires 6 months of cash reserves in the bank

What to Expect

Rent Schedule Appraisal: The appraiser won't just determine the home's value; they will also complete a rent schedule to determine the fair market rental income the property can generate.

Reserve Checks: Underwriting will scrutinize your bank statements to ensure you have enough cash to withstand a vacancy.

Compare Loan Options

Standard Full Doc vs. DSCR

Standard investment loans use your personal tax returns and W2s. DSCR loans ignore your personal income and only look at the property's cash flow, making them much faster for heavy investors.

Frequently Asked Questions

What is a DSCR Loan?

DSCR stands for Debt Service Coverage Ratio. It relies purely on the rental income of the property to qualify the loan. If the rent covers the mortgage payment, you qualify—no W2s or tax returns required.

Can I use an FHA loan for an investment property?

FHA loans generally cannot be used for pure investment properties. However, you CAN use an FHA loan to buy a 2-4 unit multi-family home, live in one unit, and rent out the others with just 3.5% down.

Ideal For

Real estate investors
Those seeking passive income
Buyers purchasing rental properties
Investors building property portfolios
Those seeking wealth through real estate

Related Calculators

Use these calculators to estimate your payments and explore your options:

DSCR Investment Calculator

Purchase Calculator

Rent vs Buy Calculator

Next Steps

Ready to move forward with a Investment Property Loans? Here's how to get started:

Schedule a consultation to discuss your specific situation and goals
Get pre-approved to understand your buying power and strengthen your offer
Find your home with confidence knowing your financing is secured
Close on your loan with expert guidance every step of the way

Ready to Explore This Loan Option?

Schedule a Call