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Posted by Hannah Lapin ● May 23, 2019 9:00:00 AM

Understanding Visio’s Rate Structures

An Overview of Visio's Rate Structures

At Visio Lending, we tailor our loan products to meet our borrowers’ needs. We’ve coined the terms “permanent rental” and “transitional rental” to describe the two main investment strategies our borrowers use. At one end of the spectrum, the permanent rental is for the rental property that an investor wants to hold onto forever. The transitional rental, on the other hand, is the property the investor wants to sell at the right time, based on market conditions. Here is a look at how our rate structures – 5/1 ARM, 5 Yr I/O,  7/1 ARM, and 30-year fixed-- fit into these two investment strategies:

5/1 ARM

Strategy best for: Transitional Rental

Use when: You want flexibility to sell your property immediately, if need be. Investors who select the 5/1 ARM structure are typically planning to sell their property within five years.

Pair with: Our 0% or 1% origination fee options, so you spend low money upfront.

5 Year I/O

Strategy best for: Transitional Rental

Use when: You want flexibility to sell your property immediately, if need be. Available with the 5/1 ARM only, the 5 Year I/O enables investors to save money by paying interest only for the first five years (it then turns into a 25-year fully amortizing loan- no balloons!).

Pair with: Our 0% or 1% origination fee options, so you spend low money upfront.

7/1 ARM

Strategy best for: Transitional Rental

Use when: You want flexibility to sell your property soon but want to wait on best market conditions. Investors who select the 5/1 ARM structure are typically planning to sell their property within seven years.

Pair with: Our 0% or 1% origination fee options, so you spend low money upfront.

30-Year Fixed

Strategy best for: Permanent Rental

Use when:  You want to hold onto your property long-term and pass on to your children. This is the set it and forget it financing option.

Pair with: Our 5% or 4% origination fee options. You may spend more money upfront, but in the long run you will save money by lowering your monthly payments.

Learn more about our Loan Programs and borrower requirements from our FAQ Page or contact us to get started on your loan.

Contact Us to Grow Your Rental Portfolio

Editor's Note: This post was originally published in May 2019 and has been updated in July 2019 for freshness and accuracy. 

Related: Understanding Prepayment Penalties, Understanding DSCR

Topics: Real Estate Investing, Finance, The Visio Box