How Investors Are Financing Their Rental Properties

Posted by Hannah Lapin on Aug 30, 2017 5:16:35 PM

How Investors are Financing Their Rentals

When it comes to financing a rental property, there are not only many different options of lenders, but also many different options of loan types. It can be overwhelming to navigate, however, a good starting point is to see what other established investors are doing. Visio Lending and other industry leaders sponsored The Iceberg Report to gather some of this information. Read on for an overview of the report's results highlighting investor financing methods.

How do investors finance their properties?

  • Cash: 23.5%
  • Permanent financing: 20%
  • Short term for buy and reno: 17%
  • Business credit line: 12%
  • Access to private money: 10%
  • Home equity line of credit: 8%
  • Self-directed IRA: 7%
  • Other: 2.5%

Specifically, how do investors finance SFR rental properties?

  • Close with permanent financing: 39%
  • Close with short-term loan, plan for refinancing: 33%
  • Close with short-term loan with conversion option: 10%
  • Other: 18%

More Resources

Related: Loan Programs Available for SFR PropertiesAn Inside Look: Real Estate Agents and Real Estate Investing

 

Topics: Finance