Investment Property 101

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By Christina Hewko, UKRFCU Business Lending Manager

Owning property is a tough but potentially rewarding business and Ukrainian Selfreliance (UKRFCU) is here to help you every step of the way. We hope the below points will be of some value to you as you embark on the search for a rental property.

Here are 4 tips you should consider when shopping for a rental income, aka investment residential, property:

  1. In general, the best investment property for beginners is a residential, single-family dwelling or a condominium. Condos are low maintenance because the condo association is there to help with many of the external repairs, leaving you to worry about the interior.
  1. Rent will be the bread and butter for your rental property, so you need to know what the average rent in the area is. If charging the average rent is not going to be enough to cover your mortgage payment, taxes and other expenses, then you have to keep looking.
  1. Property taxes are not standard across the board and, as an investor, you want to be aware of how much you will be losing to taxes. High property taxes may not always be a bad thing if the neighborhood is an excellent place for long-term tenants, but the two do not necessarily go hand in hand.
  1. As far as cash flow, take the average rent for the neighborhood and subtract your expected monthly mortgage payment, property taxes, insurance costs, and an allowance for maintenance and repairs. Don’t lie to yourself and underestimate the cost of maintenance and repairs or you will pay for it once the deal is done.

 

Financing Options

UKRFCU offers a variety of Member Business Loans for multi family residential apartment buildings and mixed use investment properties. Six or a twelve year balloon rates, which do not adjust at all during the term, provide safe and stable loan options. Longer amortizations are available as well, which lower the monthly payment. You may also refinance at any time during the balloon period, especially when rates are favorable, and of course, there are no prepayment penalties. We also offer a 12 year fixed – self-liquidating loan with very low rates. Our mortgages are risk rated, which means, the stronger the mortgage, the lower the interest rate for the member. And, we waive the attorney fee for loans of $75,000 or more.

A Member Business Loan can never be sold. We service and keep mortgages in our portfolio, and ultimately, provide exceptional service to our members. If you are interested in obtaining information or a loan application for financing, please contact Christina Hewko at 215-725-4430 x 704 or Christinah@ukrfcu.com