5 Tips for Deciding Which Investment Loan Is the Best Fit The right type of investment loan for you depends on the property you want to buy as well as your personal goals and financial standing.
by Luke Babich
I nvesting in real estate is an ex - pensive undertaking. Even experi - enced investors take out loans when purchasing an investment property. An investment loan is any loan borrowed to cover the costs of an investment property. Although the right investment loan for you may be a traditional 15- to 30-year mortgage, it could also be different from the mortgage you used to invest in your first home. For exam - ple, investment loans also include short-term mortgages for investors who want to buy and flip property. Investment property loans may
because some real estate investors take on additional lines of credit to give themselves increased financial freedom. Using rotating lines of credit, however, could end up costing more in interest than long-term home loans. Financing your investment correctly will determine your return. Start by understanding what you need from an investment loan and compare that to your current financial standing. Once you have an idea of the type of loan you’ll need, look for lenders who specialize in that area of real estate investment. Research third-party lender reviews and
consult with a trusted adviser, such as your real estate agent. Here are five tips to find the right loan for your investment property. 1. UNDERSTAND YOUR INVESTMENT LOAN OPTIONS Borrowers should understand their options as they begin to consider prop - erties and investment loans. The type of loan investors qualify for will impact their ability to turn a profit from a real estate investment. Take inventory of your desired loan terms, paying special attention to the following:
• Loan coverage area. Does the loan cover the region
need to be more flexible than a traditional home mortgage
22 :: INVESTOR REVIEW :: JUL-AUG 2023
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