If you are venturing into Tampa’s thriving real estate market, make sure you’re prepared.
Why so? Well, it’s quite simple.
Investing in real estate can be a profitable venture, but only if it’s done the right way.
Owing to factors like the low cost of living, job opportunities, population increase, and tourism, Tampa’s property market is growing strong. Which is great news for property investors.
Moreover, since property prices are still favorably low in Tampa, it’s understandable why buying an investment property might be a wise move.
Now, for most investors – especially new ones – who want to buy rental properties, financing is one of the biggest hurdles.
And if you are one of them, you’re probably wondering; where can I get funds to buy an investment property?
If so, have you considered applying for a mortgage?
This post covers all the best mortgage options for people looking to buy a rental property in Tampa, Florida.
There are many types of mortgage loans available for rental properties. Read on to find which is right for you.
In terms of requirements, down payment, and interest rates, VA mortgages are the best. But, the catch is that these types of real estate investment loans are for military personnel – both retired and currently serving – only.
According to the National Association of Realtors , at least 74% of military personnel currently serving and 54% of veterans have bought property using a VA mortgage.
Generally, the veterans’ authority issues a maximum of $424,100 per loan. And applicants can apply for more than one loan. They can apply up until they reach what is known as the entitlement limit .
So, what requirements must be met to qualify for this type of mortgage?
VA mortgage conditions and requirements:
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If you are new to the industry , an FHA-insured mortgage would be your best option. But, why do people refer to it as FHA-insured?
That’s because the FHA doesn’t issue mortgages, the FHA-approved lenders do. Instead, the FHA insures real estate lenders against losses.
Meaning, that banks can comfortably issue investment loans to high-risk applicants without having to worry about them defaulting.
Moreover, these mortgages come with very low interest rates and low down payment requirements. Let’s take a look at the features and benefits for this type of loan.
FHA mortgage requirements and conditions:
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Con:
Now, if you don’t qualify for a VA mortgage or your FHA loan application fails to pull through, you can opt for a conventional mortgage.
Basically, these are housing loans from private lenders like banks and mortgage companies.
On average, a conventional loan is cost more than a VA or FHA mortgage; while at the same time cheaper than hard money and investment property mortgages.
Here’s what you need to apply for this kind of mortgage.
loan requirements and conditions:
Pros:
Con:
When it comes to investment property mortgages, the requirements often get a bit strict and pricy.
Moreover, getting this kind of loan is never easy. Applicants must meet a number of requirements in order to get approved.
Due to their strict nature, failure to meet these requirements may lead to the loan application being denied.
Investment property loan requirements and conditions:
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If you are looking for a fast loan, a hard money mortgage would be your best option. These mortgages are ideal for investors dealing with time-sensitive purchases.
That’s because most applications are processed and approved within a very short period of time.
In terms of requirements, these loans are very lenient. In fact, anyone can apply for such a loan regardless of their credit score, the number of mortgages, or debt-to-income ratio.
Pros:
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In conclusion, try and get to know all you can about these different types of mortgage options. It is the safest way to find one that suits you best. All it takes is a little bit of research to find a good mortgage option to finance your Tampa investment property.
