< Back to News & Insights
Qualifying for a Mortgage with Market Rents
March 7, 2015 — 2 min read
Historically low interest rates, rapidly rising rental prices and high demand have created an ideal situation for clients to buy investment properties or upgrade from their current homes by becoming landlords.
Clients interested in purchasing an investment property have the ability to use 75% of the projected fair market rent, obtained from the appraisal rental survey, before the house is even rented, as qualifying for debt-to-income (DTI) ratios on a mortgage. Homeowners wanting to upgrade, or those underwater on their mortgage, can leverage their buying power by turning their current home into an income property. Homeowners no longer have to have 30% equity in their homes to take advantage of using market rents to qualify.
One of the biggest obstacles homebuyers face is being able to show enough income to offset their debts, in addition to a new proposed housing payment. As U.S. rent costs rose 3.3% nationally, with hot rental markets reaching 6.3%, income property potential has grown exponentially. Rising rents could actually help existing homeowners' buying power.
PRM is always happy to help you or your clients learn more about these unique opportunities. Eligibility criteria differ for each loan scenario. Call or email PRM today!
Categories
Archives
Recent Posts
- Pumpkin Spice & Property Price: The Difference Between Appreciation & Median Home Price
- A Home for Every Season: How to Match Clients with the Perfect Property
- From Leaves to Snow: Your Guide to Cold-Weather Home Maintenance
- Buying a Home as an Empty Nester: Tips and Tricks for Downsizing
- Preparing Financially for Parenthood and Homeownership
- The Significance of School Districts When Buying a Home
Getting started >
You bring the dream. We'll bring the diagram.
There’s a financing solution for just about every situation.
What our clients say >
I felt like I was treated like family, great communication and helping me with any questions I had.
Getting started >

You bring the dream. We'll bring the diagram.
There’s a financing solution for just about every situation.
Find an advisor >
Where does your sun shine? Find your local advisor.
Enter your city or state to see advisors near you.
Careers at PacRes>
We’re growing. Grow with us.
Careers at PacRes reward excellence in mortgage banking.
Build a better tomorrow