With mortgage rates remaining near all-time lows, now could be an ideal time for real estate investors to refinance their investment properties. There are multiple options available in today’s mortgage marketplace, from low documentation loans to conventional full-doc loans, all of which can be explored with the guidance of your home loan professional.
Take a look at the options below and discuss them with a qualified mortgage lender or broker, or contact Luxury Mortgage directly to get the details and a free rate quote.
Low and Full Doc Loan Options
With full documentation loans, borrowers traditionally provide a lot of paperwork that documents their financial assets, debts, income patterns, credit history, and more. With low or no-documentation loans, the requirements for providing such documents are much more lenient. In some cases, certain documentation isn’t needed at all—in other instances, only one or two specific documents are required.
Below are a few examples of popular low-documentation home loan programs offered through Luxury Mortgage.
Investor Cash Flow
This loan program is part of the Simple Access suite of mortgage products designed to make home financing more accessible for creditworthy borrowers who don’t fit the typical mold. For investors, this loan allows the borrower to apply based on the cash flow of the subject property. For instance, if you own a residential rental property that you wish to refinance, this program would allow you to use the monthly cash flow from the property to qualify for the refinance loan. No tax documents or employment verification is needed. Plus, there’s no limit to the number of financed properties. Learn more about this program by clicking here.
With this mortgage option, real estate investors can use their bank statements to qualify for a purchase or refinance loan. Rather than relying on employment or tax information, Luxury Mortgage looks at the borrower’s bank statements and judges their ability to repay the loan based on the balances. Borrowers can use personal or business bank statements and credit scores as low as 580 may qualify.
This is a relatively new program offered under the Simple Access loan collection from Luxury Mortgage. With the 1099 Only program, borrowers whose income is primarily based on 1099 earnings can use their 1099 tax documents to qualify for a purchase or refinance loan. This can be especially helpful for self-employed borrowers, freelancers, and independent contractors.
Reasons to Refinance in 2020
Why refinance in 2020? Here are just a few reasons to consider:
- Mortgage rates are low—as of July 10, 2020, the average rate on a 30-year fixed rate mortgage was 3.162%
- Rates are forecast to start going back up this fall—While there are never any guarantees, economists are predicting mortgage rates to start inching higher around late August or early September.
- Most homeowners have “tappable equity”—Black Knight found that more than 75% of homeowners with tappable equity (enough equity to refinance while still leaving a 20% buffer) had mortgage rates over 3.5%. Since rates are currently near 3%, the savings of refinancing would outweigh the cost for most homeowners.
Contact Us to Learn More
Not sure if refinancing to today’s lower rates makes sense for your scenario? Contact one of our mortgage professionals at Luxury Mortgage today to discuss the options and crunch the numbers. Refinancing may not be worth the costs for every homeowner, but if you think it could help position your real estate portfolio to perform better, it’s worth a few moments of your time to explore the options.
We're dedicated to helping borrowers find the right home loan program for their situation. Contact us today for a free quote and consultation.
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