Downpayment and Loan Percentages Vary? - Please help

[Philip C.]

Hi there,

I'm searching for my first out-of-state buy-and-hold investment property and after speaking to several lenders and realtors, I'm hearing different things that I hope to get some clarification on:

1. To qualify for a conventional loan, the down payment for a SFH or duplex is a minimum 25%-35%, because 20% is only for folks who intend to live in the home.

2. For an investor to get the best interest rate and terms, the home must already have tenants in place, because then 70%-75% of the rental income can go toward the loan approval, meaning less money out-of-pocket every month.

So here's where I need clarification: (For #1) Which is it? 25% or 35%? The BP webinars Brandon gives, he always inputs 20%. Why?

(For #2) Does this mean I should limit my search to only homes with tenants in place?

Sorry if these questions seem basic; it just helps to have someone tell me exactly what I need.

Thank you! - Philip