Financing an investment property when retired

[Jason Kay]

I am working with a client who is retired and can buy the property for cash but wants to leverage.

They are retired with little income, yet have lots of assets.  Thoughts on how to get reasonable, longer-term (5-7yrs) financing?

[Jorge Vazquez]

There are now asset-based loans nationwide where you can get as low as 4.9% stated income for 5,7,10,15 and 30 years term. I've been doing this for 20 years, and this is the first time investors can find low-interest rates like this on these types of loans.

I started as a financial advisor and then moved into real estate consulting. My advice is to do a 'risk tolerance test' to understand the investor's financial profile risk tolerance before providing any feedback.

Then and as long as the long-term and Short-term goals are feasible, refinance the properties to catch out or finance a new purchase. Finally, do a stress test on the properties to ensure that you can lower the rent and still cover if something happens with the rental market. Reverse-engineer and determine the maximum mortgage payment they should make by calculating the rents at a worst-case scenario (30% down). As you follow the steps, there's nothing that can stop you! Good luck!