A balloon mortgage is a loan that offers low initial monthly payments, and then a large portion of the principal is repaid in a lump sum at the end of the term. A balloon mortgage calculator helps you calculate your monthly mortgage payment, your balloon payment and the total amount of interest paid during…
About the Author
Allison Bethell
Allison Bethell specializes in Real Estate Investment. Allison has fixed and flipped over 100 properties, including residential and commercial properties. She is a licensed real estate broker in Florida. She graduated from Villanova University with a B.A. in Business and Sociology. When Allison isn’t involved in real estate or writing, she loves to travel and has been to all 7 continents. She resides in the Miami Beach area with her husband and dog.
Rental Property Depreciation: Rules, Schedule & Recapture
Rental property depreciation is a process that real estate investors use to deduct the costs associated with purchasing and improving an investment property. Depreciation of rental property happens over the course of the property’s useful life as determined by the IRS’ depreciation method. This is important for investors because rental property depreciation helps maximize tax…
How to Buy an Apartment Complex in 7 Steps
Buying an apartment complex is more involved than investing in single-family properties and involves a deeper understanding of the financial and management aspects. Typically, you can learn how to buy an apartment complex in seven steps. These steps include deciding if an apartment building is right for you and what type of apartment complex to…
Vacancy Rate Definition, Formula & Average
Real estate vacancy rate is the percentage of all units in one rental property that are unoccupied during a particular time. Vacancy rate is calculated by multiplying the number of vacant units by 100 and then dividing that by the total number of units in the building. The U.S. average vacancy rate is 7 percent….
Residential Rental Property Depreciation Calculator
How to Read Your Rental Property Depreciation Calculator Results Cost basis: This is the original purchase price of the property plus all closing costs; if you’re unsure of your closing costs, they’re typically 2 to 5 percent of the purchase price Averages of rental property depreciation: The useful life of residential rental property is 27.5…
Piggyback Loan: 80/10/10 & 80/15/5 Mortgages
A piggyback loan (aka second trust loan) is using two loans to finance the purchase of one house with less than 20 percent equity. The most common piggyback mortgage is an 80/10/10 loan. You’ll borrow 80 percent of the purchase price with a first loan, 10 percent with a second loan, and provide a 10…
Cap Rate vs. ROI vs. Cash-on-Cash Returns: A Real Estate Investors Guide
Real estate investors frequently use three metrics to measure the performance of an income-producing property: capitalization (cap) rate, return on investment (ROI) and cash-on-cash returns. It’s recommended to use all three to get the best understanding of a property’s potential rate of return. The ROI formula is annual return divided by total investment. If you…
Where to Get Investment Property Loans for Rental Property
Investment property loans are usually found through online mortgage providers, investor-only lenders, and national banks. Investment property loan amounts typically range from $45,000 to $2,000,000 or higher. Rental property loans usually require a minimum down payment of 20 percent. Buy and hold investors generally use long-term investment property loans. If you’re looking for an investment…
How Much Does It Cost to Flip a House? [+ Fix & Flip Cost Worksheet]
The cost to flip a house equals the sum of the acquisition cost, repair costs, carrying costs, and marketing and sales costs. Costs vary based on where the home is located, property type, and the extent of the renovations needed, but the total cost to flip a house is usually around 10 percent of the…
Flood Insurance: Costs, Coverage & Quotes for Real Estate Investors
Flood insurance covers property damage specifically caused by flooding. A mortgage lender typically requires flood insurance for a property located in a region that has been designated as a flood zone by the Federal Emergency Management Agency (FEMA). Flood insurance policies are obtained through private insurance providers and typically cost $700 per year or higher….
Free Net Operating Income (NOI) Calculator
How to Read Your NOI Calculator Results The rules of thumb for net operating income are typically: NOI should be positive on an income-producing property. NOI is typically calculated on a yearly basis. NOI does not include your monthly mortgage payments. NOI is typically used to figure out cap rate, ROI, and cash flow to…
5 Ways to Invest in Real Estate with Tips from the Pros
The five most common ways to invest in real estate are flipping houses, buying rentals, vacation properties, commercial real estate, and real estate investment trusts (REITs). Regardless of your real estate investment strategy, we recommend joining a real estate investment group or working with a mentor when you’re learning how to start investing in real…
