There are always opportunities in a falling market. The real estate market is no different. The rapid decline in home prices will allow new investors to acquire investment and rental properties well below market value. The number of new investment property speculators is certain to grow over the next few months and the market is also seeing a large number of international investors begin to try to purchase property.

Financing investment properties in today's real estate market is certainly going to require the borrower to be of good credit standing. Most lenders will allow for a borrower to finance an investment property for up to 90% of the properties home value, provided the borrower has a credit score above a 720. The borrowers credit score is more important then ever when qualifying for an investment property. Borrowers with less than a 720 fico score will most likely require a 20% down payment, primarily because there are no mortgage insurance or (PMI) companies who will offer coverage on loans that do not fit this criteria. If the property is in a declining or depreciating real estate market, then the borrower should expect to put down a minimum of 20% towards the purchase price. Lenders who follow Fannie Mae underwriting guidelines will finance up to 4 mortgage for a borrower and most likely wont issue further financing beyond this level. If you are thinking of buying an investment property, you should start by reviewing your options with a lender to get fully approved up front.

6-24-2008 ©LowRateMortgage.com

Compare free quotes from top lenders to find  the lowest mortgage rates online