Smarter Not Harder
For most real estate investors, owning a rental property requires a very specific rental property loan. Rental property loans tend to have higher interest rates than conventional mortgages, but some homeowners have discovered a rental property lifehack that might just work for you, too.
Step 1 – Buy Conventional
So, you found a property that you like. You need the money in order to purchase the home. In order to save interest and money on your rental property loan, the first thing to do is to buy the property with a conventional mortgage loan as an owner occupant. This will help get you started with what you need.
Step 2 – Move In
Next, move into this property as your primary residence. Now, get comfortable. Make the home comfortable enough as if you were going to live there for a long time. You need to live here at least one year before you can rent it out. Fortunately, this gives you plenty of time to make repairs, fix broken things, and accomplish any remodeling you need in order to rent it out.
Step 3 – Finance a Second Conventional Property
So you lived in your first property for a year now. This is where you can start to make a transition. After living in your new home for at least one year, start looking for a second property. Look for something that suits you since that will be your new home. Once you find your new home, now finance the second property – one that you really want to live in.
Step 4 – Move Out of the First & Into the Second
Once you have the second property, move out of the first home and into the second. You’ve already prepared the first home, for the most part. Make the remaining finishing touches to the home. Once you have the first one cleaned up, get it ready to rent.
Step 5 – Rent the First Property
At this point, after living in the first property for at least a year, you can transition the unit into a rental property without changing the terms of your mortgage. This effectively provides you with a rental property loan, WITHOUT the higher interest rates typically associated with rental property loans.
Step 6 – Enjoy Your New Home & New Rental Property Income
Lastly, enjoy your new home while also receiving income from the rental property.
An Added Bonus
If you only buy properties that you yourself would want to actually live in, it is far more likely that others will want to live in them too, making them easier to rent. Think of it this way. If you like the property, more than likely someone else will like it too.
Contact Noble Mortgage for Your Rental Property Loan
If you’re looking to become a landlord in Texas, let Noble Mortgage & Investments financially assist you with your real estate investment. Call us now at [phone] and get pre-qualified for your conventional mortgage loan today! Start on your rental property the right way.
The Rental Property Loan Lifehack You Need to Know | Noble Money, TX