Real estate investment continues to be a popular source of income for Tennessee residents. Finding the right type of investment property funding is key to ensuring financial success in this venture. To generate profit through rental income or the future sale of a home, you’ll need to find flexible funding with great rates. Whether you’re considering investing in your first property in Nashville or Memphis, or are a seasoned investor, Lincoln Home Loans will work closely with you so that you get you the financing that meets your unique investment property needs.

Funding Options

Investment properties can be short- or long-term investments, depending on what you plan to do with the home after purchase. To be considered an investment property, the home cannot be owner-occupied. There are all types of investment properties, including single- and multi-family homes, condominiums, and townhomes.

Short-term loans are used to purchase a residence that will be quickly resold with the hopes of making a profit. Commonly known as fix-and-flip investments, short-term property mortgages are used to purchase a home and then renovate the property to increase its value for maximum profit. Also known as buy and hold loans, long-term investment financing helps clients purchase property that provides rental income over time.

These are some types of investment property funding to consider:

  • Conventional loans – Conventional loans are available for investment properties. They may often require a higher down payment than if the home was to be occupied by the borrower.
  • Home-equity loans – If you have equity in an existing property, you can leverage it to obtain a new loan for an investment property. These loans are also known as second mortgages, which are piggybacked on top of the initial mortgage used to purchase the property.
  • HELOC – Like home-equity loans, a HELOC is secured by the equity built in a different property. HELOC stands for home-equity line of credit, because it provides the borrower access to a stream of cash as expenses to refurbish a home arise.
  • Cash-out refinance – Cash-out refinance allows borrowers to receive cash in exchange for the equity they’ve built in another property, often their home. The cash can be used to purchase a new investment property and/or for renovations to the property.
  • Hard money loans – Hard money loans are backed by the value of the investment property, with minimal weight placed on the investor’s own financial standing. Hard money loans typically have high interest rates and are short-term loans.

Financing for Your Investment Needs

If you’d like to learn more about investment property funding, Lincoln Home Loans is your home financing guide. Whether you’re interested in short- or long-term property we can help find the solution that meets your investing goals. We work closely without clients in Nashville, Clarksville, Memphis and the neighboring Tennessee communities. Contact us today to learn more about your investment property options!