Investment Properties
Purchasing an investment property can be a great option for many individuals that are looking for different ways to invest their money.
However, arranging financing for investment properties is a little bit more complex than the process of arranging financing for a primary residence.
The type of investment property you are looking to purchase and your plans for that specific property will help us determine which mortgage product best suits your needs.
However, arranging financing for investment properties is a little bit more complex than the process of arranging financing for a primary residence.
The type of investment property you are looking to purchase and your plans for that specific property will help us determine which mortgage product best suits your needs.
Rental Properties
Many people like the idea of renting out a property to offset or cover the costs associated with being a property owner.
Rental properties can be broken down into two separate categories, short term rentals and long term rentals.
Short term rentals might be a home/cottage or condo located in an area that is popular for tourists. These types of rental properties are typically rented out for shorter periods of time such as a week or two.
Long term rentals are generally homes or condos which are rented by people as a place to call home. These rental properties often have much longer leases attached to them that can range anywhere between 6 months to a year and in some cases, even longer.
As mentioned above, a mortgage on a rental property is structured a little differently than a mortgage on a residential home you would be living in. Under current regulations, you are required to have a minimum down payment of at least 20% when purchasing a rental property and there may be a slight premium added to the interest rate on a rental property. Other than that, the mortgage products offered for rental properties are very similar or the same as the products available for your primary residence.
If you plan on purchasing a duplex, triplex or quadruplex and living in one of the units, you don't necessarily need a 20% down payment. Provided that you use one of the units as your primary residence, you may be able to purchase the property for as little as 5% down.
Rental properties can be broken down into two separate categories, short term rentals and long term rentals.
Short term rentals might be a home/cottage or condo located in an area that is popular for tourists. These types of rental properties are typically rented out for shorter periods of time such as a week or two.
Long term rentals are generally homes or condos which are rented by people as a place to call home. These rental properties often have much longer leases attached to them that can range anywhere between 6 months to a year and in some cases, even longer.
As mentioned above, a mortgage on a rental property is structured a little differently than a mortgage on a residential home you would be living in. Under current regulations, you are required to have a minimum down payment of at least 20% when purchasing a rental property and there may be a slight premium added to the interest rate on a rental property. Other than that, the mortgage products offered for rental properties are very similar or the same as the products available for your primary residence.
If you plan on purchasing a duplex, triplex or quadruplex and living in one of the units, you don't necessarily need a 20% down payment. Provided that you use one of the units as your primary residence, you may be able to purchase the property for as little as 5% down.
Flipping Houses
Flipping a home is the process of purchasing a property at one price, renovating/upgrading the property as quickly as possible and then reselling the property for a higher amount.
Most mortgage lenders do not want to put in the time, effort or cover the costs to arrange a mortgage on a "flip" as the mortgage is going to be paid off in such a short amount of time. Therefore, financing a flip can be tricky and often times private lenders are required.
Private Lenders are expensive to work with as they charge significant setup fees and the interest rates offered on mortgages through private lenders are much higher than the interest rates offered through any other type of lender.
For this reason, it is very important that before you purchase a property you intend on flipping, you crunch the numbers beforehand to ensure that you will still make a profit when it is all said and done.
If you are thinking about purchasing a rental/investment property, I would be more than happy to sit down with you and discuss the various options with you.
Most mortgage lenders do not want to put in the time, effort or cover the costs to arrange a mortgage on a "flip" as the mortgage is going to be paid off in such a short amount of time. Therefore, financing a flip can be tricky and often times private lenders are required.
Private Lenders are expensive to work with as they charge significant setup fees and the interest rates offered on mortgages through private lenders are much higher than the interest rates offered through any other type of lender.
For this reason, it is very important that before you purchase a property you intend on flipping, you crunch the numbers beforehand to ensure that you will still make a profit when it is all said and done.
If you are thinking about purchasing a rental/investment property, I would be more than happy to sit down with you and discuss the various options with you.
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Castle Mortgage Group
100-1345 Waverley Street
Winnipeg, MB, Canada
R3T 5Y7
100-1345 Waverley Street
Winnipeg, MB, Canada
R3T 5Y7