One exciting way to build wealth and probably the best way is to build your rental portfolio by HOLDING real estate for the long term. One of the biggest challenges that relatively new investors have after they get through the experience of owning and renting their first investment property is to acquire additional properties. Specifically, getting financing for investment properties and multiple of them can be tricky.
See this link for a Podcast that goes into this topic of building a rental portfolio to go from 1 house up to 10 and beyond: (https://castbox.fm/episode/Bonus%3A-How-To-Finance-Rentals-(With-A-Case-Study)-With-lender-Caeli-Ridge-id8615-id77456301?country=us)
Fannie Mae and Freddie cap at 10 properties financed each, meaning that a couple (husband and wife) could do up to 20 financed properties if each of them were in their names individually alone. Many folks use traditional banks and mortgage companies up to 10 homes but then they sometimes struggle to get beyond that.
Ridge Lending is one of the Investor-friendly companies mentioned on this podcast that can do loans beyond the 10 that are allowed per person: https://www.ridgelendinggroup.com/
Another good company that does a variety of investor financing is Finance of America (Commercial) – https://www.foacommercial.com/.
Non QM Loans – 30 year fixed, 75-80% LTV, qualification similar to Fannie Mae/Freddie Loans, but the interest rate may be different (6.75%-ish). Three primary qualifications are credit score (720 or greater, optimal of 740 or above to get the best rates), assets, and debt/income ratio (maximum 50%).
I have seen many clients have a lot of success with 15 year mortgages. That way, they can build their equity in a much faster period of time. Once you have secured the financing for additional property, we can help you find and secure the next property or set of properties through our sister company, The Wright Choice Team (at KW Midlothian). Then, we at The Wright Choice Richmond Realty Group can help you to find the BEST tenants to set the home up for the best long-term success through experienced and highly-trained management (http://www.thewrightchoicerichmondrealty.com/).
We often help investors go from 1 to 2 to 3 to 5 to 7 to 10 and more homes as they exponentially build their wealth. Please contact us if you’d like for us to help you get there too!