Those who want to invest in bank owned Las Vegas homes or condos can buy Fannie Mae foreclosed (bank owned) homes and condos for 10% down, no PMI or appraisal
Financing is the major obstacle for real estate investors who want to invest in Las Vegas real estate and can’t pay in cash. Depending on the type of real estate, down payments of 20%-50% are required and interest rates are higher for buying investment properties.
Fannie Mae Guidelines to buy foreclosed (REO) homes and condos and high rise condominiums:
- Minimum 3.5% down for primary residence.
- 10% down payment investment property which is good for Las Vegas single family homes or duplexes, 25% on triplexes and fourplexes.
- Borrower can finance up to ten properties, but the down payment is 25% for properties 5-10.
- Mortgage insurance and appraisal are waived. This is the reason the Fannie Mae buyers can finance condominiums and luxury high rise condos for sale in Las Vegas.
- For owner occupied Las Vegas homes and condos, HomePath Loan by Fannie Mae is more expensive than counter parts like FHA loans. Buying discount points is an option to lower the interest rate and monthly mortgage payments. Discount points and upfront loan origination costs can run 1%-4.85%. Buying discount points is an option to lower the interest rate and monthly mortgage payments and upfront loan origination costs can run 1%-4.85%. Buyers can ask for closing cost contribution from Fannie Mae to cover these costs. This is due to the lower costs to the borrowers since Private Mortgage Insurance (PMI) is waived. The seller can contribute up to 6% for closing costs. One can just opt for the higher rate in lieu of the discount points.
- For the investors, the interest rate adjustment for the property being used as an investment property is 2.5 points vs. normal 3 points. However, if the investor puts down less than 20% down payment and doesn’t want to pay for PMI there is an additional 1.75 points for a total of 4.25 points.
- Same basic underwriting requirements of a conforming loan, but without the property issues (appliances missing – no problem).
This program is very effective for seasoned investors as well as first time investors. I discussed in detail how an owner occupied condominium buyer can have his/her renters pay for his mortgage and make double digit cash on cash profit in Generating cash flow from owner occupied Las Vegas condos or homes.
Las Vegas real estate investors are well aware of severely tightened guidelines for financing investment properties. Now, investors have the opportunity to buy very reasonably priced Las Vegas homes condominium or high rise condos with as little as 10% down with fantastic interest rates and NO PMI. I repeat, Fannie Mae doesn’t allow investors to bid on their home or condo for the first 30 days.