The smart, easy way to build a rental property and then to hold it as a rental. One loan closing. Great terms. Great rates. Consistent service - we fund and hold our loans on balance sheet. (Want a loan for an existing rental property? Explore existing rental property loans).
Meet standards including but not limited to these items:
Experience To be eligible for 75% LTC, built 10+ houses since 2012 and repaid Builder Finance Inc. at least 1 time (an "Experienced" borrower). For 70% LTC, built at least 5 houses since 2012 (a qualified GC can contribute 3 homes of experience).
PITIA Expected gross rent divided by Loan interest and principal using a 30-year amortization schedule, real estate taxes, insurance and association dues (“PITIA”) must be at least 1.20x or, if Sponsor has under 3 years of verifiable rental ownership experience, 1.30x.
Appraisal The LTV does not exceed 65%, or 62.5% if borrower is not Experienced, and none of the following issues in the appraisal: lack of adequate sales comparables, the property characterized as non-conforming, the market having declining values, or marketing time listed at over 6 months.
Population Within a 3-mile radius of the subject property, there is a growing population of at least 25,000 people. The house is affordable for its market.
Net Worth Net worth excluding primary residence(s) of at least $500,000 and 2x the property value.
Liquidity Average balance at bank(s) of at least $50,000.
Credit Score Minimum required credit score is 660. Pricing shown assumes 700 or higher credit.
Character / Background Acceptable background history and working relationship with Builder Finance Inc.
BUILD TO RENT TERMS
| SIZE | |
| Loan Size |
$100,000 - $750,000, call for larger loans |
| Loan-to-Cost | 80% subject to qualifications |
| STRUCTURE | |
|
Term |
5 Years + 2 Year Extension OR 10 Years + 2 Year Extension |
|
Build Phase |
1 year for construction |
| Recourse | Full |
| Payment |
Year 1: Interest only with interest reserve Years 2 and later: 30 year amortization or interest only available on 5 year |
| COSTS | |
| Origination Fee | 2% |
| Interest Rate |
5.75% fixed for 5 Years +2 Years floating Rates assume 700+ credit (660 minimum) Rate during an extension is floating at the greater of Prime +1% and the original fixed rate |
| Other | Third-party costs, $500 closing fee |
