Are you a real estate investor or thinking of becoming one? If so, you may have wondered, “How many properties can I have financed at once? If you have 5-10 homes in your portfolio, it is possible to get a mortgage, but it can be challenging. In 2009, Fannie Mae increased the maximum financed-property limit from four to ten. However, many banks won’t offer a 5-to-10 properties mortgage because the process of underwriting the investor’s mortgage application can be very tedious.
If you’re curious why some banks won’t participate in the 5-10 Properties Financed Program, they feel their efforts (or return on investments) are best spent elsewhere. Compared to “traditional” homeowners who submit for loan approval with just a W-2, pay stub, and a few months of bank statements, seasoned real estate investors are required to provide complex tax returns, complete REO schedules, and extra details for every home underwritten and approved. Reviewing all that paperwork takes substantial time. Furthermore, investors with five or more properties financed are more likely to hold title to their homes in a non-standard fashion. That can slow down the approval process for the subject home even further.
Many criteria must be met to finance a home using Fannie Mae’s 5-10 Properties Program, such as:
You might be wondering why anyone would want to have multiple mortgages at one time. The answer is simple; to build wealth. Real estate investors buy foreclosed homes, multi-unit properties, and more to build long-term wealth. With rents outpacing the rise in home prices in many U.S. cities such as San Francisco, Fort Worth, and Seattle, investors are clamoring for good homes, especially with interest rates at a historical low.
It might sound like a lot of work to finance multiple properties, and it is. But for most investors, the potential gain is worth the effort. Primary Residential Mortgage is here to help you every step of the way. Don’t hesitate to contact us with any specific real estate financing questions.