Do you want to make money by owning a rental home?
Buying a house to rent out is a great way to build wealth. But getting a loan for a rental is different than buying the home you live in. Banks are often more strict.
At Seven Lending, we make it easy. We help you find the right investment property mortgage so you can start making money. Whether you are a new or pro investor, this guide will show you how it works.
How do I get a mortgage for an investment property in BC?
To get an investment property mortgage in BC, you usually need a 20% down payment. Lenders consider your credit score, total debt, and the property’s expected rental income. If your bank says no, specialized private lenders can help by looking at the property’s value instead of just your income.
Types of Loans for Rental Homes
Not all loans are the same. You need to pick the one that fits your plan.
Fixed-Rate Mortgages
Your interest rate stays the same for years. Your monthly payment never changes. This makes it easy to plan your budget and know your profit.
Variable-Rate Mortgages
The interest rate can go up or down based on the market. These often start with lower rates, which can save you money early on.
Home Equity Loans
If you already own a home, you can use its value to buy a new rental. Using a home equity loan is a smart way to get a down payment without using your savings.
Private and Alternative Loans
These are for investors who don’t fit the bank’s strict rules. This often includes interest-only mortgage options, which are helpful for self-employed workers or those with unique properties.
4 Things Lenders Look For
Before a lender says “yes,” they check these four things:
- Credit Score: A high score gets you the best rates. But if your credit is “bruised,” we have bad credit mortgage options.
- Debt-to-Income (DTI): Lenders want to see that you aren’t spending too much of your money on other bills.
- Loan vs. Home Value (LTV): This is the size of the loan compared to the price of the home. Most lenders want you to own at least 20% of the home right away.
- Rent Potential: Lenders want to know if the house will make enough rent to pay for itself.
How to Apply for Your Rental Loan
Getting a loan doesn’t have to be scary. Just follow these steps:
- Step 1: Get Your Papers Ready. You will need tax forms, bank statements, and proof of your income. If you are a business owner, check our self-employed mortgage guide.
- Step 2: Get Pre-Approved. This shows sellers you are serious. Use our home purchase calculator to see what you can afford.
- Step 3: Find the Property. Look for homes in growing BC areas like Surrey, Langley, or Kelowna.
- Step 4: The Appraisal. An expert will check the home’s value to make sure it is worth the price.
Why Investors Choose Seven Lending
We are not a big, slow bank. We are local experts who understand the BC real estate market.
- We Say Yes: We find ways to fund projects that banks won’t touch.
- Fast Answers: Our system gets you an answer in hours, not weeks.
- Best Rates: We search many lenders to find you the lowest private mortgage rates.
- Raghav’s Expert Advice: Our co-founder, Raghav Manchanda, knows how to build a winning rental portfolio using equity.
These speed and flexibility are the advantages of private lending for real estate investments.
Tips for Managing Your Rental Property
- Pick Good Tenants: Check their credit and history before they move in.
- Keep Up with Repairs: A well-kept home stays valuable and keeps tenants happy.
- Watch the Market: BC property values change rapidly. Stay updated on real estate market trends to know the best time to refinance, adjust rents, or buy your next property.
Ready to Start Your Investment Journey?
Don’t let bank rules stop your dreams. Whether you want to buy a condo in Vancouver or plan to buy another house in Abbotsford, Seven Lending is here to help you win.
Schedule Your Free Strategy Session
FAQ
Do I need a big down payment?
Yes, usually 20%. However, many investors use a second mortgage or a private lender line of credit on their current home to cover the down payment, allowing them to expand their portfolio faster.
Can I buy a rental with bad credit?
Yes. Private lenders care more about the property’s value than your credit score.
How long does it take?
We can often get you funded in 5 to 10 business days. Big banks can take a month or more.