How to buy an investment-style property with 10% down or less

Getting a loan for an investment property with 10% down is possible, but you have to know how to make it happen. 

Loans specifically for purchasing investment properties typically require 15% to 25% up front as a down payment. But house hacking, owner-occupied multifamily strategies, and even loans for second homes may allow you to get you started with less — as little as 3.5% down, sometimes even 0% down if you're a veteran.

If you're a new investor with limited capital seeking low down payment options, understanding which programs may allow 10% down, and which don't, can save you a lot of frustration. 

This guide will explain options to get an investment property loan with 10% down or less using various strategies in 2026.

Program requirements, rates, and fees are current as of March 13, 2026 and may vary by lender and borrower profile.

Can you get an investment property loan with 10% down?

“Yes, there are absolutely ways to be able to get an investment property with financing for less than 10%,” says Becky Nova, a real estate investor and founder of the Lady Landlords podcast and community

One key to lower down payments is being willing to live in the property for a period of time. 

True investment property: This is a rental property where you don't live. It could be a single-family home, duplex, or fourplex that you rent out entirely. For these properties, conventional lenders typically require 15% to 25% down. With excellent credit (720+), you might qualify for 15% down on a true investment property, but 20%to 25% is standard.

Owner-occupied multifamily (a.k.a. house hacking): This is a two to four unit property where you live in one unit and rent out the other(s). Because you occupy the property as your primary residence, you may be able to access much lower down payment options — including FHA loans with 3.5% down, VA loans with 0% down, or conventional loan programs that sometimes require as little as 3% down.

“This is actually how I personally got started within real estate investing,” Nova explains. And it's a fantastic way to enter the world of investing with really an apprenticeship or a live on-site investment property.”

Why lenders require more down on true investment properties

Lenders view non-owner-occupied investment properties as higher risk for three reasons:

1. Payment prioritization: If a borrower faces financial hardship, they'll often prioritize their primary residence mortgage over an investment property payment to keep a roof over their head. 
2. Vacancy risk: Rental properties can sit vacant between tenants, leaving the owner without income to cover the mortgage.
3. Property management complexity: Managing tenants and maintenance from a distance increases the likelihood of problems.

What is an investment property loan?

An investment property loan is financing used to purchase real estate you don't plan to live in as your primary residence. It is referred to as non-owner occupied. These loans finance properties you'll rent long-term, flip (sell quickly), or otherwise use to generate income.

How investment property loans differ from primary home mortgages

Key differences include:

• Higher down payments: Typically 15%-25% for investment properties vs. 3%-5% for primary residences.
• Higher interest rates: Investment property rates generally run 0.5%-1.0% higher than owner-occupied rates.
• Stricter qualification: Higher credit score requirements (typically 680+) and lower maximum debt to income ratios.
• Cash reserves: Lenders often require six to 12 months of mortgage payments in reserve.

Common property types

Investment property loans can finance:

• Single-family rentals: The most common investment property type
• Two to four unit multifamily: Duplexes, triplexes, and fourplexes
• Condominiums: Subject to lender approval of the condo association
• Townhomes and planned unit developments: Owner-occupied only for low-down programs

Second home vs. investment property

In general, the property must qualify as a true second home rather than an investment property, and rental use may be limited

Investment properties are explicitly purchased to generate rental income. Second homes typically require at least 10% down on conventional loans and have stricter limitations than primary residences, but easier terms than pure investment properties

A second home is another popular way to get into real estate investing, Nova says, giving the example of someone who “wants to buy a property on a beach that's nearby or in the mountains or then have kind of their own vacation home.” These loans may sometimes only require 10% down, she notes. 

“You do have requirements where you will have to still be occupying that property for a period of time and you cannot rent it out for more than a certain period of time. For example, you cannot rent it out for more than half of the year because the requirement would be that you would occupy it for that period of time,” Nova says. 

How do investment property loans work?

Investment property loans function similarly to primary residence mortgages, but lenders evaluate these loan applications differently for credit risk and cash flow.

Typical loan structures

Most investment property financing comes in these forms:

• 30-year fixed-rate mortgages: The most common structure for buy-and-hold investors
• Adjustable-rate mortgages (ARMs): 5/6, 7/6, or 10/6 month ARMs that offer lower initial rates
• Shorter-term investor products: 15- or 20-year mortgages with higher monthly payments but less total interest

What lenders evaluate

When underwriting an investment property loan, lenders typically assess:

• Down payment: Typically 15%-25% for non-owner-occupied properties
• Credit score: Typically a minimum 680 for most conventional investment loans, though some programs may accept 620+
• Debt to income ratio: Usually capped at 40%-43% for investment properties
• Cash reserves: Six to 12 months of principal, interest, taxes, and insurance (PITI) payments 
• Rental income potential: For owner-occupied multifamily, lenders can count 75% of projected rental income toward qualifying 

Illustration of potential differences between different investment loan down payment scenarios

This is only an illustration. Actual rates and costs will vary by property, state and lender. 

The FHA loan amount includes $4,725 upfront MIP (1.75%) rolled into the loan.

Key takeaway: The FHA 10% down option requires $30,000 less upfront but costs $217 more per month due to mortgage insurance and the larger loan amount.

If you are living in one unit, you may be perfectly comfortable paying that amount out of pocket, but it has an impact on cash flow. 

How underwriting differs from primary mortgages

Investment property underwriting focuses more heavily on the property's income-generating potential, along with the borrower’s financial situation. Lenders want to see that the property can support itself through rental income and that you have enough money in reserve to cover vacancies, repairs, and unexpected expenses.

For owner-occupied two to four unit properties, lenders will count a portion of the rental income from the non-occupied units to help you qualify. This rental income offset can make the difference between qualifying and not qualifying for the loan.

What is the minimum down payment for investment properties?

The minimum down payment varies dramatically based on whether you'll occupy the property and which loan program you use.

Minimum down payment by scenario

Program requirements, rates, fees, and eligibility are current as of March 13, 2026 and may vary by lender and borrower profile

Best ways to buy with 10% down (or less)

Owner-occupied multifamily (house hacking)

House hacking is one of the most accessible paths to investment property ownership with minimal down payment. Here's how it works: you buy a two to four unit property, live in one unit, and rent out the others.

“When you live in the property, you can put down three-and-a-half percent or five% in order to get started with house hacking. It's a great entry-level way of how to get into real estate investing,” says Nova. 

It offers:

• Access to low down payment loan programs (FHA, VA, conventional)
• Rental income from other units helps cover your mortgage
• Build equity and landlord experience simultaneously

Critical occupancy requirement: You must genuinely intend to occupy one unit as your primary residence for at least one year. Lenders require you to move in within 60 days of closing. This is required by the contract you sign and violating occupancy requirements can result in loan acceleration (the full balance becoming due immediately).

FHA loans

FHA loans allow you to purchase a two to four unit property with typically as little as 3.5% down, provided you live in one of the units.

What properties qualify:

• One to four unit properties (single-family, duplex, triplex, fourplex)
• Property must meet FHA minimum property standards for safety and structural soundness
• Must be your primary residence for at least one year

Key requirements:

• Minimum credit score: 580 for 3.5% down; 500-579 usually requires 10% down
• Maximum debt to income: Generally 43% or lower, though exceptions apply with compensating factors
• Rental income treatment: You can count 75% of projected market rent from non-occupied units toward qualifying income (after 25% vacancy deduction)
• Self-sufficiency test: For three to four unit properties, the rental income must equal or exceed your total monthly housing payment after the vacancy deduction.

Trade-offs

While these loans can be a great way to get into real estate investing, there are some potential drawbacks:

• Mortgage insurance: FHA requires both an upfront fee of 1.75% of loan amount and annual mortgage insurance premiums for the life of the loan on loans with down payments of less than 10%, or eleven years for loans with 10% or larger down payments. The annual premium ranges from 0.15% to 0.75% depending on your loan but 0.55% of the loan amount is common. 
• Property condition standards: FHA appraisals are stricter than conventional loan appraisals; issues like peeling paint, safety hazards, or structural problems must be repaired before closing.
• Seller hurdles: Some sellers may be more inclined to accept a cash offer than an offer contingent on financing, especially FHA financing with its stricter requirements.

VA loans

If you're an eligible veteran, active-duty service member, or qualifying spouse, VA loans offer the strongest low-down option for multifamily house hacking.

Who qualifies:

• Veterans with qualifying service
• Active-duty service members
• Some National Guard and Reserve members
• Eligible surviving spouses

Key benefits:

• Zero down payment: No down payment required for two to four unit properties if you have sufficient VA entitlement
• No mortgage insurance: Unlike FHA or conventional loans under 20% down, VA loans don't require monthly mortgage insurance
• Competitive rates: VA loan rates are typically among the best available

Requirements:

As with any government loan program there are some key requirements, including: 

• Owner-occupancy: Must occupy one unit as primary residence
• VA funding fee: One-time fee (generally 2.15% but can vary based on down payment and whether you’ve used VA benefits before) 
• Rental income: Lenders may count up to 75% of verified rent on extra units toward qualifying
• Cash reserves: Some lenders require up to six months of principal, interest, taxes and insurance (sometimes known as PITI) reserves per rented unit

Conventional low-down programs where applicable

HomeReady and Home Possible are conventional loan programs that often allow 3% down on owner-occupied properties, including two to four unit multifamily homes. There are a number of restrictions that apply, but here is an overall summary of what you can typically expect:

HomeReady (Fannie Mae)

• Down payment: 3% minimum, up to 97% LTV
• Credit score: 620 minimum possible (660 for manual underwriting on one unit or 680 for two to four units)
• Income limit: 100% of area median income (no limit in low-income census tracts)
• Property types: One to four unit primary residence
• Key flexibility: Entire down payment can come from gifts, grants, or Community Seconds
• two to four units: Requires landlord education, minimum two months of reserves for manual underwriting

Home Possible (Freddie Mac)

• Down payment: 3% minimum, up to 97% LTV
• Credit score: 660 minimum for manually underwritten fixed-rate purchase; 680 for ARMs/refinance; 700 for two to four units
• Income limit: 80% of area median income
• Property types: One to four unit primary residences
• Rental income: Can count up to 30% of qualifying income from rental income on one to two unit properties
• Two to four units: Requires landlord education for purchases, minimum two months of reserves for manual underwriting

These loans can be a good fit for borrowers with strong credit buying two to four units where one unit will be their primary residence. Buyers must also meet income requirements and are willing to complete homeownership education.

Remember that these are primarily primary-residence programs that allow the financing of multifamily properties, not true investment property programs. You cannot use them for true non-owner-occupied rentals, and that means you need to buy a property in a location where you are willing to live, at least for the foreseeable future. 

Seller financing and "subject-to" strategies

If a seller is very motivated and can’t find a traditional buyer, you may be able to buy a property without getting a loan from a third party. There are two approaches here: 

• Seller financing: The property owner carries the note instead of a traditional lender, allowing you to negotiate down payment, interest rate, and terms directly.
• "Subject-to": You take over the seller's existing mortgage payments without formally assuming the loan (the existing loan stays in the seller's name).

When sellers might agree

• Seller needs to move quickly and/or wants to avoid realtor commissions
• Seller prefers steady income stream over lump sum
• Property has been on market for extended period
• Property is owned free and clear (no mortgage) 

“With seller financing, you are really creating the deal,” Nova says. “You can negotiate with a seller to put down less than 10%. You might have to make other concessions with the term of the loan (or) with the interest rate, but there is also the possibility to do seller financing for less than 10%.”

​​Subject-to deals are complex, nonstandard transactions that can trigger serious legal and loan-servicing issues and should be reviewed by qualified legal and real-estate professionals before proceeding.

Risks and warnings

These shouldn’t be handshake agreements. Work with a real estate attorney to prepare and review the sale and loan documents.

These options work best for homeowners with a strong cushion of home equity, good personal and business cash flow, and who want to purchase an investment property without liquidating other assets.

Down payment assistance and gift funds

If you have a family member or friend willing to offer financial help, both FHA and conventional programs may allow you to use gift funds or down payment assistance programs to cover some or all of your down payment.

Both HomeReady and Home Possible allow the entire down payment to come from gifts, grants, or approved assistance programs with no minimum borrower contribution required on one-unit properties. For two to four unit properties, Home Possible requires 3% from borrower personal funds if LTV exceeds 80%.

Down payment assistance programs may be another option, though it takes effort to find and qualify for them. State and local housing finance agencies often offer programs for first-time buyers and income-qualified borrowers. These programs can provide grants (money you don't repay) or low-interest second loans.

These programs can be helpful to buyers who meet local program income requirements and have family members willing to help, or who qualify for state/local assistance programs.

True investment property loans to consider if 10% down isn't realistic

If buying an owner-occupied property or second home isn't feasible and you need financing for a true non-owner-occupied rental, here are the main options:

Costs and trade-offs of low down payment investment financing

Lower down payments mean you borrow more, and that means you’ll pay more. This isn’t necessarily bad, as many successful business owners leverage borrowed funds. But you need to understand how it affects your return on investment. You’ll want to take into account:

Higher interest rates

Investment property rates can run 0.5% to 1.0% higher than primary residence rates.

On a $300,000 loan, a 0.75% rate difference means approximately $150 more per month and $54,000 more in interest over 30 years.

Mortgage insurance

Mortgage insurance helps protect the lender if the borrower defaults. It is required for certain loans such as: 

• FHA loans: 1.75% upfront + 0.55% annually on typical low down payment loans
• Conventional loans under 20% down: Private mortgage insurance (PMI) required but cancellable at 20% equity
• VA loans: No monthly mortgage insurance, but 2.15% funding fee for most first-time users

Closing costs, points, and fees

Expect to pay closing costs of around 2% to 5% of the purchase price in addition to your down payment. Investment property loans may carry higher fees than loans for a primary residence. You may be able to pay points (prepaid interest) to buy down your rate, but this will mean more money out of pocket. 

The biggest mistake Nova sees new investors make is failing to understand the requirements of their loan contract.

“So usually, with any time that you're putting less than the 10% or less down, it usually has a requirement that you will have to occupy the property for some period of time,” she emphasizes. “There are absolutely exceptions that allow you to vacate the property before that one-year agreement in your contract, but I do want to make sure that people are reading their contracts and understanding their agreements.” 

How do you qualify for an investment property loan?

Qualifying for an investment property loan often requires meeting stricter standards than primary residence financing. While each lender sets their own specific requirements, understanding the core qualification criteria can help you prepare.

Credit score requirements 

For conventional investment properties, you'll often need a minimum credit score of 680 or higher. Scores of 720 or higher will often help borrowers qualify for better rates and terms.

If you're pursuing an owner-occupied multifamily property through FHA, you may qualify with a score as low as 580 for the 3.5% down option. VA loans don't set a minimum credit score, but most lenders prefer to see at least 620.

The HomeReady and Home Possible programs accept scores ranging from 620 to 700 depending on the specific property type and whether the lender uses automated or manual underwriting.

Debt to income ratio

Investment property lenders often look at your debt to income ratio. This compares your total debt payments (including the new loan payment) to your total income. DTI is often capped at 40% to 43%. 

Loans for owner-occupied homes may allow higher DTI ratios, especially if you have strong compensating factors like excellent credit or substantial cash reserves.

One significant advantage of owner-occupied multifamily properties is that rental income from your non-occupied units may help toward the income counted in calculating your DTI. 

Cash reserves

Investment property can be risky. Properties may sit empty, tenants may not pay the rent, or repair costs can be expensive. For this reason, lenders often require enough cash to cover six to 12 months of PITI (principal, interest, taxes, and insurance). Owner-occupied multifamily programs are more lenient, usually requiring just two to three months of reserves.

While this requirement may be frustrating, it helps protect you, too. From a lender’s perspective, they are essential, and higher reserves may help compensate for weaknesses in other areas of your application like credit scores or debt-to-income ratio.

Down payment documentation

Paperwork is always a big part of getting a property loan. Lenders will carefully vet your down payment funds to see where they came from. Approved sources can include:

• Verified savings that have been seasoned in your accounts for at least two months
• Gift funds from family members — you'll need a gift letter confirming the money doesn't need to be repaid
• Documented sale of assets like stocks or vehicles
• Qualified down payment assistance programs
• Retirement account withdrawals with proper tax documentation

The key is having a clear paper trail. Large deposits that appear suddenly in your bank account will trigger questions and may even result in a rejection of your application. 

How to evaluate a deal before you borrow

Before committing to any investment property loan, run the numbers to ensure the property will actually generate positive returns.

This is where new investors often make costly mistakes, says Nova. With a low down payment, your monthly payments will be higher, and that can hurt cash flow. 

Basic cash flow calculation

Monthly cash flow = gross rent − all expenses

Expenses may include:

• Principal and interest (P&I)
• Mortgage insurance 
• Property taxes
• Homeowner insurance
• HOA or condo fees (if applicable)
• Property management (typically 8% to 10% of rent if outsourced)
• Maintenance reserve (typically 1% to 2% of property value annually)
• Vacancy reserve (typically 5% to 10% of gross rent, depending on market)
• Utilities you pay (if any)

“In an economy like this, if you're looking at a high cost of living option with high interest rates (and/or) high sale prices, it's going to be harder to find something to cash flow when you're literally putting down the absolute bare minimum,” warns Nova. 

Analyze your deal carefully, taking into account all costs as well as reserves for repairs, vacancies or rising costs like higher real estate taxes. 

Rules of thumb

There are several rules of thumb that real estate investors may use to quickly size up a deal. They are rough guidelines, and you shouldn’t use them as a substitute for in-depth analysis. Markets can vary significantly, and your specific property's expenses may be much different than averages. Still, they can be useful as an initial framework.

The 1% rule: Monthly rent should equal at least 1% of purchase price. A $300,000 property should rent for $3,000/month, for example. 

The 50% rule: Roughly 50% of gross rental income goes to operating expenses (excluding mortgage). On $2,000/month rent, for example, you may want to expect $1,000 for expenses before the mortgage payment.

Again, these are screening tools and don’t necessarily represent what you can expect on a specific property. 

Key questions to ask

Before you commit to a property or a loan, ask yourself these questions:

1. Does the property cash flow positive from month one, or will you need to subsidize it? If so, can you afford to do that?
2. Can you handle six to 12 months of vacancy and still make payments?
3. Do you have reserves for major repairs (roof, HVAC, foundation)?
4. What's your exit strategy if the property doesn't perform as expected?
5. Have you accounted for all costs, including those that aren't monthly (annual tax increases, capital improvements, or special assessments)?

How to get an investment property loan

Here are the basic steps to getting an investment property loan. Your exact steps will vary depending on the property and your qualifications. 

Step 1: Pick your strategy

Decide whether you're pursuing a true investment property (15% to 25% down) or an owner-occupied house hacking strategy (3% to 10% down). This will determine how you move forward. 

Step 2: Check your qualifications

Before shopping for properties:

• Pull your personal credit scores and review your credit reports from all three major consumer credit bureaus
• Calculate your debt to income ratio
• Verify you have adequate cash reserves (usually six to 12 months PITI for investment properties)
• Confirm your down payment source and that funds are properly documented

Step 3: Get preapproved with the right lender type

Different lenders can serve different needs:

• Mortgage brokers: Access to multiple lenders and programs
• Online lenders: Often fastest processing for straightforward deals
• Specialty investment property lenders: For DSCR, hard money, or portfolio loans
• Banks/credit unions: Helpful for portfolio loans and relationship-based lending

Ideally, you want to get preapproved for a loan before you start shopping. A preapproval letter shows sellers you're serious and can actually close.

Step 4: Make offers with financing contingencies aligned to your loan

When you find the property you want to buy, you’ll make an offer. Contingencies can help protect you in the due diligence process. These can include:

• Financing contingency period (typically 21 to 30 days for conventional, 30 to 45 for FHA/VA)
• Appraisal contingency
• Inspection contingency
• Proof of preapproval or prequalification

For investment properties, sellers often prefer buyers with fewer contingencies, larger down payments, and conventional financing over FHA or VA loans, as they expect those deals to close more smoothly. 

Step 5: Navigate underwriting, appraisal, and closing

Once your property is under contract, you’ll want to make it as easy as possible for the lender to get your loan to approval. 

• Submit all requested documents promptly
• Respond to underwriter conditions quickly
• Don't make any major financial changes (new credit, job changes, large purchases)
• Review the closing disclosure three days before closing
• Bring certified funds to closing as specified

Remember that if you use funding for an owner-occupied multifamily property, you typically must move in within 60 days and occupy for at least a year.

Bottom line

For new investors, the most realistic path to 10% down or less is through owner-occupied multifamily house hacking using FHA loans (3.5% down), VA loans (0% down if eligible), or conventional programs like HomeReady and Home Possible (3% down).

These programs can offer legitimate opportunities to help homeowners build wealth through rental income. The trade-off is that you must genuinely occupy one unit as your primary residence for at least one year.

If you're not willing or able to live in your investment property, expect to find a private lender or put 15% to 25% down and to meet stricter qualification requirements. But for new investors with limited capital, house hacking remains the most accessible entry point to real estate investing in 2026.

The key is matching your strategy to your goals, capital, and willingness to be an owner-occupant landlord. Start with what you can afford today, build equity and experience, then expand your portfolio as your resources grow.

You can copy this sample fillable deal analyzer to see if a property investment you're considering makes sense.

INVESTMENT PROPERTY DEAL ANALYZER

Property Address: _________________________________________________

Date Analyzed: ________________ Analyzed By: _________________

STEP 1: PROPERTY INFORMATION

Purchase Price: $ _______________

Number of Units: _____ (circle one: 1 / 2 / 3 / 4)

Property Type: (circle one) Single-Family / Duplex / Triplex / Fourplex / Condo

Year Built: ________ Square Footage: __________

STEP 2: FINANCING DETAILS

Loan Type: (circle one) FHA / VA / Conventional / DSCR / Other: ____________

Down Payment %: _______% = Down Payment $: _______________

Interest Rate: _______%

Loan Term: _____ years (typically 30)

Mortgage Insurance (if applicable):

• Upfront MI/Funding Fee %: _______% = $ _______________
• Annual MI %: _______% = Monthly MI: $ _______________

STEP 3: EXPECTED RENTAL INCOME

Unit 1 (your unit if house hacking): $ _______________ /month

Unit 2: $ _______________ /month

Unit 3: $ _______________ /month

Unit 4: $ _______________ /month

TOTAL GROSS MONTHLY RENT: $ _______________

TOTAL ANNUAL RENT: $ _______________ (monthly × 12)

STEP 4: MONTHLY EXPENSES

MORTGAGE PAYMENT:

• Principal & Interest: $ _______________ (use mortgage calculator)
• Property Taxes: $ _______________ (annual tax ÷ 12)
• Homeowners Insurance: $ _______________ (annual premium ÷ 12)
• HOA/Condo Fees: $ _______________
• Mortgage Insurance: $ _______________ (from Step 2)

SUBTOTAL (PITI + MI): $ _______________

OPERATING EXPENSES:

• Property Management: $ _______________ (8-10% of rent if hiring)
• Maintenance Reserve: $ _______________ (10% of gross rent recommended)
• Vacancy Reserve: $ _______________ (5-10% of gross rent)
• Utilities (if you pay): $ _______________
• Lawn/Snow/Exterior: $ _______________
• Other: $ _______________

TOTAL MONTHLY EXPENSES: $ _______________

STEP 5: CASH FLOW CALCULATION

Gross Monthly Rent: $ _______________

MINUS Total Monthly Expenses: - $ _______________

= NET MONTHLY CASH FLOW: $ _______________

× 12 = NET ANNUAL CASH FLOW: $ _______________

(Circle one: POSITIVE / NEGATIVE / BREAK-EVEN)

STEP 6: CASH REQUIRED TO CLOSE

Down Payment: $ _______________

Closing Costs (typically 2-5%): $ _______________

Inspection/Appraisal: $ _______________

Upfront MI/Funding Fee: $ _______________

Initial Repairs/Improvements: $ _______________

Cash Reserves (6 months PITI): $ _______________

TOTAL CASH TO CLOSE: $ _______________

STEP 7: INVESTMENT RETURNS

Cash-on-Cash Return:

Annual Cash Flow: $ _______________

÷ Total Cash to Close: $ _______________

= ________% Cash-on-Cash Return

Cap Rate (rough estimate):

Net Operating Income (annual rent - operating expenses, no mortgage): $ _______________

÷ Purchase Price: $ _______________

= ________% Cap Rate

STEP 8: QUICK RULE CHECKS

1% Rule:

• Purchase Price × 1%: $ _______________
• Your Monthly Rent: $ _______________
• Meets 1% Rule? (circle one): YES / NO

50% Rule:

• Gross Monthly Rent: $ _______________
• × 50%: $ _______________
• Your Operating Expenses (no mortgage): $ _______________
• Within 50%? (circle one): YES / NO

70% Rule (for fix & flip):

• After Repair Value (ARV): $ _______________
• × 70%: $ _______________
• MINUS Repair Costs: - $ _______________
• = Maximum Purchase Price: $ _______________
• Your Offer Price: $ _______________
• Good deal? (circle one): YES / NO

STEP 9: QUALIFICATIONS CHECK

Do I likely qualify for this loan?

My Credit Score: ________

Minimum Required: ________ (FHA: 580 / Conv: 680 / VA: 620)

Qualify? (circle): YES / NO

Debt to Income Ratio:

My Monthly Debts: $ _______________

• New Mortgage Payment: + $ _______________

= Total Monthly Debt: $ _______________

÷ My Gross Monthly Income: $ _______________

= ________% DTI

Max Allowed (typically 43-50%): ________%

Qualify? (circle): YES / NO

Cash Reserves:

Months Required: _____ months (Investment: 6-12 / Owner-occ: 2-3)

× Monthly PITI: $ _______________

= Required Reserves: $ _______________

I Have Available: $ _______________

Qualify? (circle): YES / NO

STEP 10: DEAL DECISION

RED FLAGS: (check all that apply)

• ☐ Negative cash flow (and not house hacking)
• ☐ Doesn't meet 1% rule
• ☐ Expenses over 60% of rent
• ☐ Major repairs needed beyond my budget
• ☐ HOA restricts rentals
• ☐ Poor neighborhood/declining area
• ☐ Can't qualify for financing
• ☐ Insufficient cash reserves

GREEN FLAGS: (check all that apply)

• ☐ Positive cash flow from day one
• ☐ Meets or exceeds 1% rule
• ☐ Property in good condition
• ☐ Growing neighborhood
• ☐ Below-market purchase price
• ☐ Owner will negotiate
• ☐ Multiple exit strategies
• ☐ I qualify for financing

MY DECISION:

☐ MAKE OFFER - Maximum offer price: $ _______________

☐ NEGOTIATE - Issues to address: _______________________________________

☐ PASS - Reason: ___________________________________________________

Frequently asked questions