Our no-income investment property loans can be useful for almost any borrower, but you will find these loans are especially popular for certain types of investors.
Instead of using typical income documents, such as pay stubs and tax returns, you can work with our team for an investment-property loan that uses the future income generated by the property. If the rent meets a certain percentage of the loan total, we can qualify the loan using future rent as your income and ignore other debts, significantly increasing your chances of approval.
The program has various options for terms and allows for the purchase of many different properties, including single-family homes, multiunit properties, and even condominiums. It’s a convenient and effective way to start or enhance an investment portfolio, and it may be the perfect option for your financial future.
From buyers new to the investment-property market to borrowers with multiple properties, these are the investors who benefit the most from our no-income loans.
6 Types of Borrowers Who Benefit from No-Income Loans for Investment Property
Self-Employed, Freelancers, and Entrepreneurs
Of all the people who can benefit from a no-income investment-property loan, the self-employed borrower is likely #1. With a typical mortgage application, you would bring, among other documents, paystubs and other information related to your day job. Most people will be able to show a clear amount that they bring in every month, making the lender’s job much easier.
But if you are self-employed, you likely don’t receive a consistent income; you may receive $5,000 one week, $50 the next, and $1,000 the next. This inconsistency can makes using typical income documentation far more difficult. Besides the inconsistencies, there may be complications related to your taxable vs non-taxable income, and this issue could make your stated income difficult to figure.
Because of the complication, many self-employed investors may prefer to use a no-income loan for their investment purchase.
Do you work in a career where your income is based on commission, such as a real estate agent or sales representative? In this case, you suffer from many of the same complications that trouble self-employed borrowers: the inconsistent income makes borrowing for a property difficult.
Because your income is inconsistent, and your year-to-year income can vary widely as well, it’s often best for commission-based employees who want to build a portfolio of investment properties with no-income loans. You won’t have to bother with averaging your income or working through the complexities of income verification, making your purchase far more convenient.
If you are purchasing an investment property for the first time, you may discover that a no-income loan is the best option. Because you don’t have the history of investment purchases, many lenders will have extensive documentation requirements, which could complicate or even halt the borrowing process.
Even if you are a first-time investment buyer, these loans can help you get the financing you need. Purchasing your first property is already complicated, and there is a lot of research and preparation you’ll need to complete. With this loan option, you’ll have a simplified process that results in an affordable loan so you can start building your financial future.
For both personal homes and investment properties, foreign nationals often have difficulty with the borrowing process. Because this type of person doesn’t have a history of credit and income in the United States, qualifying for a mortgage is complicated. After all, if you have only been in the U.S. for a few months, proving your income is difficult, and many American lenders won’t honor credit profiles from foreign countries.
Although there are certain challenges, this program is available for foreign nationals, allowing them to create a foundation of investment properties that can bring financial stability and wealth.
If you operate your investments under an LLC, this program is ideal for you. Using factors like the total rent income that you’ll receive from the property, we can help you qualify for a loan even when you are closing under an LLC. There are numerous advantages to using an LLC, but most of all it is a great way to reduce the overall risk to your personal property. For example, if an injury occurs on your property, but that property is under an LLC, the party filing the suit cannot go after your personal finances.
With this loan program, you can enjoy the benefits of closing under an LLC without required income documentation.
Condos can be a good investment if you find the right property in the right building. For people who purchase condos for their investment properties, our no-income loans make a wonderful option. These loans allow for the purchase of many different properties, including condos, and you can use the financing to purchase both warrantable and non-warrantable properties.
When purchasing condos as an investment, you need to do a lot of research on the facility, including gathering information on the homeowner’s association, finances of the building, legal status, and rental caps. However, they can be wonderful investment that allow you to create or enhance a portfolio with a smaller cost.
Some no-income loans only allow a few properties to be mortgaged by the borrower. For example, if you already have five mortgaged investment properties, you may be unable to get the loan you need for another purchase.
With this loan program, however, you can have up to 20 financed properties. If you are a high-volume investment-property owner, you may find that this is one of the few no-income loans for investment property that will deliver your financing.
Learn More About No-Income Loans for Investment Properties
If you want more information on using a no-income loan for the purchase of your investment property, contact the staff at San Diego Purchase Loans today. We take a common-sense approach to mortgage underwriting, helping you qualify for top-quality loans with reasonable terms.