Real Estate Investing Real Estate Investing Investment Property Financing Questions and Answers 2

Question 1

What is the typical minimum down payment percentage required for an investment property conventional loan?

Accepted Answer

25%

Answer

15%

Answer

20%

Answer

30%

Question 2

Which loan metric compares a property's net operating income to its annual debt service payments?

Accepted Answer

Debt service coverage ratio

Answer

Loan-to-value ratio

Answer

Cap rate

Answer

Cash-on-cash return

Question 3

What is a blanket mortgage primarily used for in real estate investing?

Accepted Answer

Covering multiple properties under one loan

Answer

Financing a single luxury property

Answer

Refinancing an existing mortgage at a lower rate

Answer

Providing short-term bridge financing

Question 4

Which type of financing allows investors to borrow against the increased equity in a property after renovations?

Accepted Answer

Cash-out refinance

Answer

Hard money loan

Answer

Seller financing

Answer

Home equity line of credit

Question 5

What does the term 'seasoning period' refer to in investment property financing?

Accepted Answer

The time required to hold a property before refinancing

Answer

The period during which interest rates are locked

Answer

The duration of a construction loan

Answer

The waiting period after a loan application

Question 6

In a 1031 exchange, what is the maximum number of days an investor has to identify replacement properties after selling?

Accepted Answer

45 days

Answer

30 days

Answer

90 days

Answer

180 days