- The Federal Tax Credit Program allows the investor to take up to 20% of the mortgage interest paid annually of tax owed.
- The minimum down payment required for owner occupied is 0-3%; rentals 10-15%.
- Down payment can be borrowed from a whole life insurance policy, but not from a credit card or personal friend or relative.
- Today an appraisal is more likely to come in at the purchase price, rather than higher or lower.
- An unpaid library fine, traffic ticket or rental payment will not impact a credit score.
- The cost of borrowing money for a borrower with a credit score of 620 vs 720 is 3+ points in higher fees.
- It is true that internet credit scores are different than mortgage credit scores.
- Loans are not available for clients in Chapter 13 bankruptcy, foreclosure or short sale less than 2 years ago, or who have a credit score as low as 580.
In the beginning of real estate accumulation, investors can take on riskier lower down payments with back-up of earnings from jobs and savings. As their portfolio grows, the more prudent option is to improve properties, or take advantage of raising prices and rents to reach safer loan-to-value ratios.