Income Property Mortgage

AAA

DEFINITION of 'Income Property Mortgage'

A loan given to an investor to purchase a residential or commercial rental property. Income property mortgages are typically much harder to qualify for and often require a borrower to include estimates of the rental income that will be received from the property. Unlike owner-occupied and single-family residences, there are few government loan programs to assist in the purchase of income properties. This leaves investors at the mercy of private lenders, who themselves are at the mercy of the credit markets.

INVESTOPEDIA EXPLAINS 'Income Property Mortgage'

Owning a rental property is one of the most common real estate goals of individual investors. Accomplishing this goal however, is much harder than the late-night infomercials would make it seem. The biggest hurdle in acquiring rental properties is securing an income property mortgage, which generally requires a larger down payment than the purchase of a primary residence. Typically, an income property mortgage requires a larger down payment relative to personal home mortgages.

RELATED TERMS
  1. Garbage Fees

    Unnecessary fees tacked onto mortgage closing costs by lenders ...
  2. Home Mortgage

    A loan given by a bank, mortgage company or other financial institution ...
  3. Investment Real Estate

    Real estate that generates income or is otherwise intended for ...
  4. Passive Income

    Earnings an individual derives from a rental property, limited ...
  5. Principal Residence

    The primary location that a person inhabits. It doesn't matter ...
  6. Closing Costs

    The expenses, over and above the price of the property that buyers ...
Related Articles
  1. Home & Auto

    Tips For The Prospective Landlord

  2. What makes a rental property profitable?
    Entrepreneurship

    Top 10 Features Of A Profitable Rental ...

  3. Taxes

    Tax Deductions For Rental Property Owners

  4. Home & Auto

    Simple Ways To Invest In Real Estate

Hot Definitions
  1. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  2. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  3. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  4. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  5. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center