If you’re thinking of buying an investment property, here are a couple of handy financing options.
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I have a client who’s looking to buy a duplex in San Clemente that’s priced slightly under $1 million. If you find yourself in a similar situation, what kind of financing should you use to purchase your property?According to Dave Marzinky of Movement Mortgage, there are two options you should consider. The first is conventional financing. The minimum down payment for this option is 15%. You can then use 75% of the gross rent of the other units to finance the purchase. The minimum FICO score needed for this loan is 620 but, as always, the better your credit score the better your financing terms will be. Since my client’s score is roughly 740, her interest rate will be in the 3% to 4% range.
The better your credit score the better your financing terms will be.
The second option is an FHA loan, whose minimum down payment amount is 3.5%. In any case, passive income is a great way to build wealth, and with interest rates as low as they are, it’s a great time to buy an investment property. If this is something that interests you, don’t hesitate to reach out to me so I can help you get the ball rolling. As always, if you have any other real estate questions, feel free to reach out to me as well. I’d love to help you.
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