This article is for you if you are a veteran or active duty military member interested in rental investments! Owasso rental properties can be a terrific way to safeguard your financial future and increase equity. Nevertheless, there are a few things you must know before beginning. This manual will walk you through the fundamentals of buying rental properties as a service member or veteran. We’ll also cover a few suggestions that will make it easier to find and purchase investment properties. This manual has something for everyone, regardless of your level of experience with rental homes!
Invest with a VA Loan
If you are a veteran, you might qualify for a VA loan. This type of loan can be used to buy a rental property and offers massive benefits, including no down payment and lower interest rates. To qualify, you must fulfill a number of requirements and earn enough money each month to pay your mortgage. If you qualify, a VA loan can be a fantastic way to finance the purchase of a rental property.
There are also some VA loan disadvantages to consider. For starters, if your down payment is less than 20%, you may be required to pay private mortgage insurance (PMI). Moreover, the amount you can borrow is subject to restrictions determined by the county in which the property is situated. Therefore, you may not be eligible for a VA loan if you’re considering rental properties in high-priced areas.
You also need to be aware of the occupancy requirements. After purchase, you or a qualified tenant must occupy the home as your main residence for at least one year. Thereafter, you can rent the property to tenants. However, if you vacate before the one-year mark, you may be required to pay a penalty or modify the terms of the loan.
Use BAH to Secure Financing
The Basic Allowance for Housing (BAH) is yet another fantastic perk for investors who are in active duty military. BAH is a housing allowance that aids reduce the overall rental housing costs. It depends on your pay grade, where you are assigned to work, and whether you have dependents. BAH can be used to help with the monthly mortgage payments if you’re looking for a rental property close to your place of employment.
Being on active duty in the military and possessing valid orders for a permanent change of station (PCS) are requirements for BAH eligibility. Additional requirements for obtaining financing include having sufficient savings for a down payment on the rental property and providing proof of your income. But if you are already receiving BAH, you might be able to put it toward buying a single-family house, a townhouse, or a condo. Before submitting an offer on a rental property, you should consult with a housing counselor or real estate agent about the BAH restrictions.
Go Multi-Family
Consider a multi-family property if you’re looking for a rental home that will bring in more money. Duplexes, triplexes, or fourplexes are examples of these properties. They have the potential to attract more tenants and charge higher rent. Veterans can use VA loans to finance multifamily properties if they intend to occupy one of the units.
It’s important to research a rental property with multiple families before making an investment. Determine if there is a demand for rental units by conducting market research. Calculate the costs related to the property as well as any potential rental income. A Owasso property manager would be a fantastic resource to assist you in gathering all of this data. You may proceed with making an offer on the property if everything checks out.
The most significant disadvantage of multifamily homes is that they require more maintenance and repairs. To avoid problematic tenants, you’ll also need to thoroughly screen applicants. Although, if you are willing to face the challenge, a multifamily rental property can be an ideal way to accumulate equity and create revenue.
Veterans and service members can finance rental properties in a variety of ways. Employing great features such as VA loans and BAH, building a portfolio of investments is a strong choice for you. You can become a successful rental property owner wherever you go by doing some planning and research on the type of rental property you’re interested in.
Working with a local rental market veteran is one of the best ways for military personnel or veterans to invest in rental properties in their area. Contact Real Property Management Abound to find out more about the wide range of services we provide to investors and potential investors like you! You can contact us online or call 918-984-4433.
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