This article is for you if you are a veteran or active duty military member interested in rental investments! Bangor rental properties can be a terrific way to safeguard your financial future and increase equity. Before beginning, there are a few things you should be aware of. This guide will walk you through the fundamentals of investing in rental properties as an active-duty service member or veteran. We’ll also go over some pointers to make finding and purchasing investment properties simpler. This guide has something for everyone, whether you are a newbie or a professional in rental properties.
Invest with a VA Loan
Those who have served as a veteran might be qualified 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. You must be eligible for a mortgage and have sufficient income to cover the monthly payments. A VA loan could be a great way to finance your investment in a rental property if you are eligible.
There are also disadvantages associated with VA loans to consider. For example, you may be required to pay private mortgage insurance (PMI) if your down payment is less than 20%. The county in which the property is located also affects the maximum amount you are permitted to borrow. Therefore, you might not be able to use a VA loan if you’re looking at rental properties in expensive areas.
Likewise, there are occupancy requirements you must be aware of. After purchasing the property, you or a qualified tenant must live there as your primary residence for at least a year. Following that, you can lease it to tenants. However, if you vacate the property before the one-year mark, you may be required to pay a penalty or modify the loan terms.
Use BAH to Secure Financing
The Basic Allowance for Housing (BAH) is a fantastic benefit for military members who are currently serving. A housing allowance known as BAH is used to defray some of the expenses of renting a home. Your duty station’s location, pay grade, and the presence of dependents are taken into consideration. BAH can be used as a down payment on a rental home if you’re looking for one close to your place of employment.
You must be serving in the military on active duty and possess valid orders for a permanent change of station (PCS) in order to be eligible for BAH. 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. There are some limitations on how BAH can be used, just be sure to consult a housing counselor or real estate professional before actually making an offer on a rental property.
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 who intend to live in one of the units themselves may use VA loans to finance a multi-family building.
Before investing in a multifamily rental property, it is essential to conduct sufficient research. To determine whether there is a demand for rental properties, first, analyze the local market. You must also estimate the property’s potential rental income and associated expenses. A Bangor property manager would be a fantastic resource to assist you in gathering all of this data. You can start with submitting an offer for the property if all is in order.
The most significant disadvantage of multifamily homes is that they require more maintenance and repairs. To avoid problem tenants, you will also need to conduct a thorough tenant screening. However, if you’re up for the challenge, investing in a multi-family rental property can be an excellent way to increase equity and make money.
There is a wide selection of financing options available to veterans and active-duty military personnel for the payment of rental units. You should consider expanding your investment portfolio using special benefits like VA loans and BAH. With some research and planning, you can become a successful rental property owner regardless of where you live or the type of rental property you desire.
Collaborating with a local rental market expert is one of the most effective ways for veterans and veteran members to invest in rental properties. To find out more about the various services we provide investors like you, please contact Real Property Management Acadia! You can contact us online or call 207-561-7482.
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.