7 Best Investment Property Loans for 2023

If you’re looking for a lender that can provide a high level of customer service, PennyMac is an excellent option. It has consistently received positive reviews from borrowers, with many having cited the lender’s level of knowledge and quick response times.

Borrowers looking to purchase a single-family home as an investment property can qualify with a down payment as low as 15%. Two- to four-unit properties require a minimum 25% down payment. Other qualification requirements include a credit score of 620, six or more months of cash reserves, and a debt-to-income ratio not to exceed 50%.

PennyMac reviews most of its conventional loans in accordance with Fannie Mae and Freddie Mac guidelines. This includes adhering to conforming loan limits which vary based on a property’s characteristics and geographic location. Current conforming loan limits allow for a maximum loan amount of $2,095,200. While PennyMac does offer higher loan amounts on its jumbo loan programs, investment properties are not eligible.

To see what options you have with PennyMac, you can get an online rate quote in under one minute. Your credit score will not be impacted as its quotes do not require any of your personal information to be provided.

With Baselane, you can get approved for a loan without any income verification. This simplifies the process since you won’t have to provide items like pay stubs, tax returns, or W2s. For this reason, we’ve selected it as the best provider for easy documentation requirements.

Baselane offers long-term rental loans and rehab loans. Repayments can be made monthly for up to 30 years and can be used for a purchase or refinance. Eligible properties include single-family homes, condominiums, and two- to four-unit properties. A prepayment penalty does apply if the loan is paid off within five years. Its rehab loans, meanwhile, have no repayment penalty.

An added benefit of working with Baselane is the fact that it offers other tools that landlords and investors may find useful. This includes banking products, which can help organize and track cash flow from properties, simplify the process of collecting rent, and gain visibility to more property metrics.

You can get a quote on Baselane’s website in under 1 minute. If you decide to proceed, you can also submit a formal loan application. This provider can also issue funding as fast as 10 days.

If you prefer conducting business online, Rocket Mortgage is a good lender to consider. It offers a digital application process that makes it easy to view your loan status, upload required documents, communicate with your loan officer, and request revisions to your loan terms.

Rocket Mortgage was formerly known as Quicken Loans. Besides a name change in 2021, the two companies are the same, although you may sometimes see others using the two names interchangeably.

With Rocket Mortgage, you can get up to $2.5 million for a residential investment property. Eligible property types include single-family homes, two- to four-unit properties, townhomes, condominiums, and planned-unit-developments. Most loans that are within the established conforming loan limits will be reviewed in accordance with Fannie Mae or Freddie Mac requirements. Loans exceeding those limits will be reviewed under its jumbo loan program.

In addition to a streamlined online process, Rocket Mortgage is known for providing excellent service. It has been rated #1 for mortgage origination satisfaction by J.D. Power multiple times in previous years.

To get the process started, you can submit an online application from the lender’s website, something that can be completed in less than 10 minutes.

If you want to have a single monthly payment for multiple rental properties you own, you can consider Kiavi’s rental portfolio loan program. The lender offers competitive rates and terms for investors who own five or more rental properties. Its rental portfolio loans offer rates as low as 6.875%, the ability to do a cash-out refinance, and repayment terms of 10 and 30 years with interest-only options.

A major benefit of Kiavi’s rental portfolio loan program is its simplicity. In addition to only needing to keep track of one payment for multiple properties, there is less documentation required to get a loan. You’ll also qualify for more competitive rates as you continue growing your rental portfolio.

Minimum loan amounts start at $500,000, and you’ll need a down payment of 25% or more. Eligible property types include two- to four-unit homes, single-family properties, and planned-unit developments. Properties that are ineligible for financing include mixed-use, commercial, mobile, and rural homes.

If you do not have enough properties to qualify for its rental portfolio program, you can also consider the provider’s other financing options, such as its bridge and debt service coverage ratio (DSCR) rental loans.

If you’re looking to finance one or more vacation rentals, Visio Lending can offer competitive rates, flexible loan terms, and easy documentation requirements. Available financing options include purchases, rate-and-term refinances, and cash-out refinances.

Visio Lending’s vacation rental loans focus on a property’s cash flow and borrower’s credit. Income is not considered as part of the lender’s evaluation—this tends to lead to an easier application process since you won’t have to provide certain income documents like tax returns or W2s.

This provider’s vacation rental program is meant to grow with you as an investor. There is no limit on how many properties it can finance, so it’s a good option if you are aggressively growing your investment portfolio. Individual loan amounts range from $100,000 to $2 million and require a downpayment of 20%.

Eligible properties must have a minimum value of $150,000 and be rent-ready. You can finance single-family homes, condos, and townhomes. Properties ineligible for financing include manufactured homes, mobile homes, vacant land, and log homes.

Visio Lending currently offers financing in 38 states and Washington, D.C. To apply, you can contact the provider using its toll-free number. You can also submit an online form requesting a callback.

If you want to purchase a rental property that is in need of repairs, LendingOne offers short-term rehab loans under its fix-to-rent loan program. Funding can be used to conduct pay for repairs or upgrades, after which you can replace it with a more permanent source of financing.

This provider is unique in the sense that it allows you to roll its short-term rehab loan into a 30-year rental loan. This makes it more convenient for borrowers as it can save time and money from needing to apply for a separate loan elsewhere. Using LendingOne for both the short-term and long-term rental loan also entitles you to discounts on closing costs.

Another added benefit of this provider is that its rental loans require less documentation than a conventional loan. Certain income documentation can be waived, which can allow for faster funding speeds.

Eligible rental properties include single-family homes and two- to four-unit properties. Rate quotes can be obtained online in less than 2 minutes, at which point you can also decide if you want to submit a formal application.

Veterans United specializes in VA loans. It offers competitive rates and has consistently received good reviews from borrowers, making it a good option if you’re eligible for this type of loan.

Rates are competitive and can be as low as around 5.95%. With Veterans United, you’ll need a credit score of 620 and a debt-to-income ratio below 41%. Residual income will also be reviewed, which is calculated as the amount of income left over after certain monthly expenses of yours are considered. Some examples of these expenses include utilities, debt payments, and child support payments.

Closing costs can range from around 2% to 4% of your total loan amount. Part of your closing costs may also include a VA funding fee, which is typically between 0.5% and 3%. The specific amount can be determined by things like your down payment, whether you’ve previously had a VA loan, and the type of loan you are now applying for.

To apply or learn more, you can visit the Veterans United website.

No, as you’ll usually need a credit score of at least 620 to get approved. However, in addition to your credit score, lenders will review your credit report for any derogatory items. Recent late payments, collection accounts, foreclosures, and bankruptcies can make it difficult to get approved for a loan regardless of your credit score.

Yes, it can be difficult to qualify for an investment property loan. These loans represent a greater level of risk to lenders, so qualification requirements for things like credit, income, and asset items are stricter. If you want to have a streamlined approval process, you can use our tips for how to get a small business loan.

Investment property loans tend to have higher rates and fees compared to owner-occupied real estate. To make sure that an investment will give you a high enough return on your investment, you can evaluate properties using tools like our capitalization rate calculator.