The financing to help grow your portfolio is here.

Whether you’re just starting out or already a seasoned pro, Embrace Home Loans has flexible options to help you get the financing you need for your next investment property. We’ve even created our one-of-a-kind Beyond by Embrace program to help certain borrowers who may be in more unique financial situations, including those who are self-employed or have a history of foreclosure or bankruptcy, secure a mortgage for an investment property.

For experienced investors, our Debt Service Coverage Ratio (DSCR) loans require no personal income documentation and are a great alternative to hard money loans. Designed for business purposes only, you can qualify for financing with the income from your rental property, so personal tax returns and W-2s aren’t necessary.

Working with a larger budget? We can help with that, too. We have programs that support loan sizes up to $2.5 million.

If you’re ready to get started, contact an Embrace loan specialist to learn about today’s investment property interest rates or read more below about our various programs.

What type of loan are you looking for?
  • Fast & Secure
  • Flexible loan options                      

DSCR Programs

  • FICO® Scores as low as 660 accepted
  • Personal tax returns and W-2s not required; qualify based on property's rental income
  • Typically lower rates and fees than hard money loans
  • Up to 20 financed properties allowed – many programs limit to six
  • 30-year loan option – hard money loans average 10 years or less
  • Loans for business purposes only – may not be used for personal, family, or household purposes

Frequently asked questions

Which type of loan should I use when buying an investment property?

Whether that’s an Airbnb, short-term, or long-term rental, you’ll need to look at either a Conventional loan or an investor-focused financing method for your purchase.These include:
  • Conventional loans
  • Jumbo loans
  • Home equity loans or HELOCs
  • Investment property loans – our Doc Lite loans are a great option for new and experienced investors alike. You can even finance multiple properties without tax returns, W-2s, or other financial documents.
  • Hard money loans – these require a big down payment but typically have much lower qualifying standards than other loans. They come from private lenders and are usually only short-term.
  • Peer-to-peer (P2P) lending – P2P lending platforms can also help you finance your purchase by connecting you to cash-flush investors. Popular choices include Lending Club, Upstart, and Fundrise.
These are the financing options you can’t use:
  • VA and USDA loans
  • FHA loans (unless you plan to live in a unit)
A second mortgage is a lien taken out on a property that already has another mortgage attached to it. In the case that the loan goes into default, the first mortgage will be paid off first before the second mortgage. Therefore, a second mortgage is typically riskier for lenders and will often come with a higher interest rate. Interest-only payments means that for a period of time, the payments you make on the loan go 100% towards the interest that is accruing on the mortgage. And a balloon payment means that, at the end of the term of the loan, the balance of the mortgage is due all at once.

Homeowners enjoy a slew of tax write-offs that other Americans don’t have access to. You can deduct the interest you paid on your mortgage, your property taxes, and much, much more. See this list for a full breakdown of potential write-offs.

The exact deductions you’ll be eligible for depend on which activities you took part in last year. Please be sure to speak with a tax professional before making any decisions. See below for more detail:

If you purchased your home last year, then you’ll want to check your closing statement. If you paid for points (listed under Section A of the loan costs section), you may be able to write the costs of these off. If you itemize your returns, you’ll also be eligible to deduct your private mortgage insurance costs and the interest you paid on your mortgage — both at closing and across the year — along with your property taxes, too.

If you sold a home, as long as you made less than $250,000 in profits on the transaction ($500,000 if you file jointly with your spouse) and you lived in the house at least two years, you’ll be exempt from paying capital gains taxes on your home sale. This could save you a significant amount in taxes.

Additionally, you’ll also be eligible for deductions for your interest, mortgage insurance, and property taxes before you sold the house — and on your new home, if you bought another after.

If you refinanced your mortgage, it's treated much like purchasing a new home. If you paid for points or prepaid interest at closing, these can be deducted from your annual tax returns. You also may be able to write off things like mortgage insurance, property taxes, and interest paid across the year.

If you neither bought, sold, or refinanced last year but instead, stayed in the same home as the year prior, you’re still eligible for some write-offs. Use this list to guide you.

Homeowners are allowed to write off their property taxes, but there are some caveats to doing so. First, you must itemize your returns. This means forgoing the standard $12,400 deduction ($24,800 for a couple filing jointly), and instead writing off many smaller deductions in its place. If you do opt for this route, deductions for state and local taxes (property taxes included) are capped at $10,000. Be sure to speak with a tax professional before making any decisions.

You can deduct interest on up to $750,000 in mortgage debt. This can be spread across both a primary residence and a second home. So, if your first home has a mortgage of $200,000 and your second home a mortgage of $500,000 ($700,000 total), you can write off the full amount of your interest paid across the year.

The IRS does not allow you to write off interest on third homes or beyond. If you own an investment property, you’ll likely deduct its interest and other costs as business expenses. Be sure to speak with a tax professional before making any decisions.

Yes, if you’re thinking of buying a second home to visit occasionally but also rent the rest of the time, then you’ve got a lot of options to pick from. The one catch? You’ll need to let your lender know that you intend to rent the property out — even if it’s only part of the time. Not all lenders will allow this, and they might also have different qualifying standards for what they deem “investors”.

You can collect rent on a second home as long as you occupy the property for some portion of the year. You cannot have a timeshare agreement and you cannot be subject to agreements that give a management firm control over the occupancy of the property. You can use VRBO or Airbnb because you, as the owner, are determining the dates it will be available for rent versus a company telling you when you can use it.

Additionally, any income generated from renting the property can’t be used for loan qualification. As soon as you do that, it gets treated as an investment property.

Typically, here are the financing options you’ll be able to use:

  • Conventional loans
  • Jumbo loans
  • Home equity loans or HELOCs
  • 401(k) loans
  • Investment property loans – These are mortgages designed specifically for investment properties and can vary from lender to lender.
If you want to choose the best vacation home for your needs and budget, follow these steps:

Start with the location – Do your research and narrow down the right location. If you’re going to use the home primarily for your own enjoyment, make sure it’s somewhere you can travel easily and often. A cabin for skiing in the mountains might be nice, but how often will you be able to visit? Make sure it's an easily accessible location. If you’re considering putting the property up for rent, also take into account tourist demand. Will others want to travel there? How much would they be willing to pay for it?

Pay attention to maintenance and repairs – Make sure you factor the costs of maintaining and caring for the house into your calculations. Remember that homes situated on the beach or near saltwater are going to have lots of wear and tear — and they may even need added protection from floods and hurricanes. Be sure to consider these as you evaluate properties to purchase.

Leave wiggle room for extras – Since this is a second home, you’ll likely need to fully furnish the property and decorate it, too, so set aside a separate budget for after-purchase expenses. This is especially important if you plan to rent out the property, as you’ll want the place to be comfortable and inviting to potential guests. You may also want to budget for toiletries and cleaning costs if renting is on your radar.

"In my opinion it’s all about trust. Trust that Vickie is fair and will listen and explain whatever questions I have. It’s not that simple but she makes it seamless." - Fazle, VA
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Not a commitment to lend. Conditions and fees apply. Embrace Home Loans reserves the right to cancel this offer at any time. Interest rates are determined on the day you lock your rate. If published rates fall below your locked rate, Embrace Home Loans will allow a one-time offer to re-lock your rate at the lower rate.