What is an Investor Loan?

An Investor (or Investment) Loan is simply a term for any loan used to finance the purchase of an investment property. This includes mortgage loans where a buyer is “flipping” a property, or when someone wants to buy a property and rents it out, keeping the property in your portfolio for a longer period of time.

What Loan Types are Available?

Bridge Loans

A bridge loan is a type of short-term loan, typically taken out for a period of 2 weeks to 3 years pending the arrangement of larger or longer-term financing.

Fix- and- Flip Loans

Fix-and-flip loans are short-term loans used to purchase and improve a property to then sell for a profit. These improvements range from minor renovations to a complete reconstruction of an existing home. Fix -n- Flip loans typically include funding for the purchase of the property as well as funding 100% of the rehab costs.

DSCR Loans

A typical Non-QM Debt Service Coverage Ratio (DSCR) loan allows a borrower to qualify for a mortgage based on cash flow generated from an investment property – through a rental, for example – as opposed to their personal income. The calculation generates a ratio of rent (income) VS debt (monthly payment – principal, interest, taxes, insurance, and HOA dues if applicable). The higher the ratio, the better.

Hard Money Loans

A hard money loan is a type of secured loan that’s used to buy hard assets—usually real estate. Instead of relying on the creditworthiness of a borrower, hard money lenders instead weigh the merits of the investment that a borrower is looking to fund and use that investment as collateral

If you’re considering taking out an Investor Loan on a new property, we recommend you contact us to discuss the best loan type for your investment.

What Else Should I Consider?

  • Strong credit provides additional and better opportunities
  • Required down payments are generally larger (20%+)
  • If you are considering purchasing a multi-unit property and living in one of the units, you may be eligible for an FHA loan which carries more generous qualification requirements

Florida: 1990 Main Street Suite 750 Sarasota, FL. 34236 | (941) 867-6384

Colorado:100 Fillmore St 5th Floor Denver, CO. 80206 | | (720) 414-2962

The information provided by this site cannot be guaranteed in regards to your individual financial position by Mortgage - General. All examples are hypothetical for illustrative purposes only. For the most accurate and personalized results, we encourage you to seek advice from one of our qualified financial professionals.

Company NMLS# 2032360
Jacy - 2032901
Martin - 1890993

Equal Houseing Lender
JML Mortgage, LLC BBB Business Review