Posted by Hannah Lapin ● Jun 13, 2019 9:00:00 AM

3 Visio Investor Strategies

Investor Strategy

At Visio Lending, we strive to make our loan programs customizable to meet our investor’s needs. Our investors can pick the rate structure, origination fee, and prepayment penalty that works best for them. Here is an overview of the three most common investor strategies we have seen our borrowers use- permanent rental strategy, transitional rental strategy, and vacation rental strategy- and how they tailor our loan products to work with their investment strategies.

Permanent Rental Strategy

What it is: Permanent rentals are the rental properties investors want to hold onto long-term. Through this investment strategy, investors are looking to build a legacy of rental properties. These investors are more interested in the long-term costs associated with the loan and are willing to pay more upfront money.

How to Customize Our Loan Programs for this Strategy

  • Rate Structure: Permanent rental investors often select the 30-Year Fixed Rate. We call this option our “set-it and forget it financing.”
  • Origination Fee: Through our 2-4% origination fee options, permanent rental investors will pay higher fees yet can buy down their rates, which saves money in the long run.
  • Prepayment Penalty: Permanent rental investors often opt for our standard 5/4/3/2/1 prepayment penalty structure. Since they plan to hold on to their loans long-term, a penalty for paying off in five years is a moot point.

See our recently closed permanent rentals

Transitional Rental Strategy

What it is: Transitional rental investors are focused on flexibility and market conditions. They want to be able to sell when the time is right and are more interested in spending the lowest possible amount upfront.

How to Customize Our Loan Programs for this Strategy

  • Rate Structure: Transitional rental investors often select either the 5/1 ARM or 7/1 ARM rate structure, depending on how soon they plan to sell the property.
  • Origination Fee: With our standard 1% origination fees, transitional rental investors can put less money down upfront. While this option has higher monthly payments than our other options, their upfront cash expense is lower enabling them to work on other projects.
  • Prepayment Penalty: Transitional rental investors opt for either one of our shorter prepayment penalty options. Again, these options add basis points to their monthly rates, yet still save them money long-term to get out of a penalty fee for paying off early.

See our recently closed transitional rentals.

Vacation Rental Strategy

What it is: At Visio Lending, we pride ourselves in our ability to make sense of short-term rents, and fund vacation rentals based on DSCR, rather than personal income. Our Vacation Rental Loan Program is a little different than our buy and hold rental loans programs. However, vacation rental investors still have flexibility to tailor our loan programs to meet their vacation rental investment needs.

See our recently closed vacation rentals.

Ready to tailor our loan programs to meet your investment needs? Contact us to get started on your loan. Looking for resources to help you build your rental portfolio? Check out our Investor Resources

More Resources

Editor's Note: This post was originally published in June 2019 and has been updated in June 2020 for freshness and accuracy. 

Related: Understanding DSCR, Why Buy and Hold Investors Love Visio

Topics: Real Estate Investing, Finance, Vacation Rentals, The Visio Box