B.C. Rental Property Financing

We leverage the equity in your own home, so you don't use a dollar of your savings or cash. 

Our rental home realtor works with you to understand what type of rental may suit your needs and will then execute the purchase on your behalf. 

Next, we have property management execute any repairs or renovations needed to prepare the property for the market. Your property is then marketed, filled with tenants, and actively managed for any ongoing maintenance.

The first step is calculating your available equity in your home that we can put to work by leveraging intelligently, growing your real estate portfolio, i.e. your net worth. 

To calculate, we need a copy of your existing mortgage statement. We'll have one of our real estate rental experts complete a CMA (comparable market analysis) to confirm the value of your home.

No. We'll have an appraiser confirm the expected rental income, which all lenders use as qualifying income towards your mortgage application. 

Further, we recommend that you seek properties that are not presently tenanted. The risk is not having been part of the tenant application process that you'll be accepting the guidelines of the existing owners and can't guarantee that they completed their due diligence. 

A common fear of potential investors is owning a property with all expenses and not having a tenant in place to pay rent, providing income to offset mortgage payments.

Let us put that fear to rest - demand on rental properties is far exceeding supply. 

Further to that, average closing dates between signing an accepted offer and closing to have ownership of the property is 60-90 days. Within your offer, we'll negotiate to ensure you have the right to view or show the property two additional times before closing. 

A strategy that we employ for our investors is utilizing those viewings to show the property to potential tenants. 

We'll have our property management team market, show, complete applications, and ultimately confirm your new tenant by evaluating their credit, income and references for your closing date. 

The minimum down payment for a rental income property is 20% if you are not occupying a unit in the property as your primary residence.

For up to a duplex while occupying one of the units, the minimum down payment is 5%. 

For up to a 3-4 unit rental property while occupying one of the units, the minimum down payment is 10%. Rental income from the non-owner-occupied units can be used as a qualifying income on your mortgage application.

It may contradict your expectation that a rental income property would yield a premium on the rate, compared to your owner-occupied home.

The reason comes down to risk exposure. If you were to fall ill, incur a job loss or suffer any hardship, you are less likely to bounce your rental property mortgage payment over the payment of your primary residence. 

Further, there is limited liquidity since buyers of rental property will require a 20% down payment compared to that of a primary residence. This limited liquidity restricts the ability of those qualifying, which lowers the market of eligible buyers.

Therefore most lenders have a 0.25-0.35% rate premium.

The good news, however, is that we can amortize up to a 30 year period, which compared to a 25 year, yields a lower monthly mortgage payment.