RESIDENTIAL LOANS:

Residential Loans, also known as Investment Property Loans, are a type of Loan that is designated for Investment Properties primarily used for Residential purposes. It is important to note that Residential Loans are Loans for “Non-Owner Occupied” Property, meaning that they are not for Properties that you intend to personally occupy in any form or fashion. Residential Loans include Long Term Loans, Bridge Loans, Construction Loans, Rehab Loans, and Portfolio Loans, that are all secured by a Residential dwelling. Being that these Loans are normally used for Properties that will produce a profit for you as a Business transaction, the Interest Rates are typically higher than those of “Owner Occupied” style Mortgages. And in addition to higher Interest Rates, a larger Down Payment is required when in comparison to Owner Occupied Mortgages.

The Underwriting Process for Residential Loans is different as well. There is no concern about your Personal Income as these Loans are dependent upon the actual, and potential, performance of the Property itself. Topics such as the Current Value and the ARV (After Repaired Value) rise to the surface of consideration if any Rehab, or Construction, is involved. The DSCR (Debt Service Coverage Ratio) is a primary concern if the Property is currently being used as, or is intended to be used as, a Rental Property. Experience with Investment Property works wonders on the Interest Rate, and Terms, of these Loans, and you are essentially rewarded for volume making Residential Loans an extremely valuable tool for Investors looking to build a Portfolio of Rental Properties as well as Rehabbers and Developers alike.