Rental Loans

Rental Loans

A rental loan is a financial tool designed for real estate investors in the United States who own or are looking to purchase multiple rental properties. This type of loan consolidates mortgages for several properties into a single loan, making management more straightforward and often more cost-effective than traditional financing methods. Ideal for investors with residential or commercial properties, these loans streamline the financial oversight of multiple units or buildings.

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Benefits of Rental Loans

  1. Simplified Management: Managing one loan for multiple properties reduces administrative burden and can lead to more streamlined property management.
  1. Cash Flow Management: By consolidating loans, investors might lower their monthly payments, improving their cash flow. This can provide more liquidity for operational expenses or further investments.
  1. Potential for Better Rates: Lenders often view multiple property investments as less risky than single investments, potentially leading to better interest rates and terms.
  1. Flexibility in Financing: Rental loans can provide significant flexibility regarding refinancing options, allowing investors to leverage their properties' equity to free up capital for additional investments or improvements.
  1. Growth Opportunities: With easier management and potential cost savings, investors can focus more on expanding their portfolios and less on handling individual loans and properties.

For seasoned real estate investors, rental loans offer an effective way to manage and expand their investments. These loans provide the leverage and flexibility needed to maximize the profitability of a diversified rental property portfolio. With their ability to consolidate debt and streamline the management of multiple properties, lending for rental portfolios can be a calculated move toward long-term financial objectives. However, like all financial tools, they should be used judiciously, clearly understanding the terms and conditions and the inherent risks.

Rental Portfolio

Loan on a portfolio of 5+ rental properties or units
SFR, condo, townhome, multifamily
Up to 75% of value (70% LTV on 3-year term)
3, 5, 7, or 10 year term
$500k – $50M+

30-Year DSCR

Rental Property based
on DSCR
SFR (1-4 unit), condo, townhome
Up to 80% of value
1.00x Min DSCR
$75k – $2M+

Short-Term Rentals

Loan on 5+ short-term rentals w/ 12+ month operating history
SFR, condo, townhome, multifamily
Up to 75% of value (70% LTV on 3-year term)
3, 5, 7, or 10 year term
$500k – $50M+

Qualification Criteria

See if you project fits (Rental Loans)

Credit Score

620 minimum Fico, no derogatory credit in the past 2 years

Loan Term

30 or 40 years

Maximum Loan to Value

80% of purchase and rate and term refinance, 75% cash out

Prepay Penalty

Mostly 3 years and can be reduced to 1 year

Location

No rural located properties, MSA population greater than 50,000

Purpose

Long-term mortgages for stabilized cash flowing rental properties

Property Value

As is value of minimum $125,000

Property Type

Single family, condo, townhouse, 2-10 units

Minimum DSCR

Minimum debt coverage 1:1, we can go lower with some restrictions
Up to 90% Loan to cost, 75% of after repaired value of completed rehab

Loan Amount

$100,000 to $5,000,000 million

Liquidity Requirements

Closing costs, down payment, 6 months of reserves

American Financial Lending Inc.

We bring a customized, unique approach to mortgages. Our lending solutions use the perfect hybrid of human-driven insights and technical prowess to process loans faster and significantly reduce costs.

PHONE

805-419-9097

E-MAIL

info@afloans.mortgage

ADDRESS

2625 Townsgate Rd. Suite 330, Westlake Village, CA 91361

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