Investment Property Loans and Self Directed IRA’s

When you are ready for your next investment property, you’ll probably find that getting approved for an investment property loan is not as painless as it once was.  There are quite a few companies providing loans for investment properties and you can absolutely get approved, but you’ll need to take note of the current lender requirements.

The good old days of no cash down or low cash down options are a vision of the past.   You’ll be told to put 20%-30% down and you’ll need to have first-class credit.  If your credit is decent, but not fantastic, then expect to put even more cash down.  Is it still possible to obtain an investment property loan with no money down?  Actually, yes, but these loans are usually obtained from a commercial lender that will accept cross collateral (a lien on an additional property that you already own) in lieu of a down payment.

Your best bet will be to seek out a mortgage broker that specializes in investment property loans in your area.  They will usually know of all the lenders that offer funding options that will fit your requirements, and will be able to structure the best deal for your situation.

In addition to knowing the best financing options, they may also have other clients that both purchase investment property and fund private investment property loans themselves.  Savvy lenders will often have some private lenders at their disposal to contact when conventional loan options are unavailable.

Private lenders regularly have funds on deposit in a self directed IRA account specifically for backing private notes for individual investors that are unable to get a conventional investment property loan.   Depending on the interest rate they want, this could be a win-win opportunity for everyone involved, so stay open-minded.

Be sure to ask around, search the web, and locate the best options for you.  Don’t get frustrated if you don’t find the perfect solution right away.  The best option for you could exist in a single relationship that is right around the corner.  Do your research, know your boundaries, and take it at your own pace.