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Investment property financing: how it differs from a primary home loan

July 14, 20262 min readHelloLend Team

A mortgage for a rental looks like a primary home loan on the surface, but the rules change underneath. Lenders treat investment properties as higher risk, on the assumption that a borrower in financial trouble will give up the rental before the home they live in.

Investment property terms at a glance
15–25%
typical starting down payment
0.5–0.875%
above primary home rates
680+
credit score for top pricing
75%
of projected rent counted toward qualifying

Reserves of six months or more are commonly required, sometimes per property.

What changes from a primary home loan

  • Down payments typically start at 15% to 25%, well above primary home minimums.
  • Interest rates run higher, often 0.5% to 0.875% above primary home rates.
  • Credit score expectations are stricter, usually 680 or higher for top pricing.
  • Cash reserves of six months or more are commonly required, sometimes per property.
  • Rental income can sometimes count toward qualifying, but typically only 75% of projected rent.

What lenders look at most closely

  • Your debt-to-income ratio with the new mortgage included
  • Whether the property's projected cash flow supports the loan
  • Your experience as a landlord, since some programs favor experienced investors
  • The condition and rental potential of the property itself

When conventional financing falls short

For experienced investors, portfolio loans, DSCR loans and other non-QM products open additional doors. These loans focus more on the property's income than on your personal financials.

Investment property financing is available and well developed, but it rewards preparation, cash reserves and clear projections.

Buyers who treat the deal like a business, not only another mortgage, tend to qualify more smoothly and at better terms. See how an investment property loan is structured before you make an offer.

Published July 14, 2026 by the HelloLend Team. General information, not legal or financial advice. Talk to your loan officer about your own loan. This is not a commitment to lend or extend credit.

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