This article is for you if you are a veteran or active duty military member interested in rental investments! Spring Branch rental properties can be a great way to build equity and secure your financial future. However, there are a few things you should be aware of before beginning. The fundamentals of buying rental properties as a veteran or active duty person are covered in this guide. We’ll also discuss a few tips that will facilitate the search for and acquisition of investment properties. This guide has something for everyone, whether you’re just getting started or are already familiar with rental properties!
Invest with a VA Loan
If you are an eligible veteran, you might be able to get a VA loan. This kind of loan is excellent for buying rental properties because it requires no down payment and has lower interest rates. You must fulfill certain eligibility criteria and earn enough money to cover your mortgage payments each month. A VA loan might be an excellent option for financing your investment in a rental property if you meet the requirements.
VA loans have a few downsides you should be aware of. In the event that you put less than 20% down on the property, for instance, you might be required to pay for 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. The property must be used as your primary residence for at least a year after purchase by you or a qualified tenant. 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
A wonderful benefit for active duty military investors is called the Basic Allowance for Housing (BAH). A housing allowance known as BAH is used to defray some of the expenses of renting a home. 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.
To be eligible for BAH, you must be on active duty and have orders for a permanent change of station (PCS). In addition to proof of income and sufficient funds for the rental property’s down payment, you’ll need these items to obtain financing. In contrast, if you are already receiving BAH, you might be able to put that money toward the purchase of a single-family house, a townhouse, or a condominium. Be sure to consult with a housing counselor or real estate agent prior to submitting an offer on a rental property, as there are restrictions on how BAH can be used.
A multi-family property might be a good option if you’re looking for a rental that will bring in more money. Duplexes, triplexes, or fourplexes are examples of these properties. They provide the possibility of increased rental rates and more tenants. Veterans may finance a multi-family building with VA loans as long as they intend to live in one of the units themselves.
Research is crucial before making an investment in a multi-family rental property. First, investigate the local market to determine if rental units are in demand. You should also figure out the property’s potential rental income and associated costs. A Spring Branch property manager would be a tremendous resource to help you locate all of this information. You can move ahead with submitting an offer for the property if everything appears to be in order.
The main drawback of multi-family homes is the increased maintenance and repair costs. In order to prevent troublesome tenants, you must carefully screen potential tenants. But if you’re up for the challenge, investing in a multifamily rental home can be a great way to build equity and make money.
Veterans and members of the military on active duty have several options for financing rental properties. You have a great choice in expanding your investment portfolio by utilizing special benefits like VA loans and BAH. 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 Affiliates 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 713-429-0411.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.