Strong credit
A higher score earns more competitive pricing. Keep your utilization low and your inquiries reasonable, and the loan rewards you for it.
Loan Program · Conventional
Conventional loans. Your Golden Tickets.
The short answer
Keep reading for the full breakdownConventional loans are backed by Fannie Mae and Freddie Mac, and for a real estate investor they are typically the most competitive financing available: strong pricing and strong borrowing power, with fixed-rate options.
They qualify on you, your personal income, your credit, and your reserves, and you get up to ten financed properties per qualified investor. A couple or business partners qualifying separately are each eligible for their own ten, going from ten to twenty and beyond. We call those slots your Golden Tickets, and they are the first product we reach for with newer investors. The whole game is using them in the right order.
01 ·The Program
What conventional financing is
Conventional loans follow the guidelines of Fannie Mae and Freddie Mac, the two agencies that buy most home loans. Because they are sold into that system, they come with the most competitive pricing and the most borrowing power an investor can get.
They are full-documentation loans. You qualify on your personal income, your credit, your debt-to-income ratio, and your reserves, with fixed-rate options that keep the payment steady for the life of the loan.
Why we call them Golden Tickets
Conventional financing runs to ten financed properties per qualified investor. A married couple qualifying separately reaches twenty, and business partners are each eligible for their own ten, so a team of three can reach thirty between them.
One nuance worth knowing: the ten-property count applies to financing rental properties. You could hold eleven financed properties and still get a conventional loan on a primary residence as number twelve, because the guideline does not apply to your own home. The count itself is broad. Any residential property with a loan in your name spends a slot, and so does any loan you personally guaranteed, DSCR included. That is exactly why order matters so much.
02 ·What It Rewards
What conventional underwriting looks at
This is a loan that qualifies on you. Four things carry the file.
Documented income and DTI
Conventional is full-doc. Your income and your debt-to-income ratio drive the approval, which is why your tax return matters here in a way it does not for DSCR.
Reserves and down payment
Expect a larger down payment on a non-owner-occupied property than on a primary residence, plus reserves. Reserves can be liquid or non-liquid, and retirement accounts can count. The exact figures depend on the deal and the number of financed properties you currently hold.
The property
Conventional is residential only: single-family up to four units, and that includes condos and townhomes. The appraised value and condition are still a large part of the picture. Standard, financeable properties are the easiest files.
03 ·At a Glance
Conventional, in short
Educational content, not a rate quote or a commitment to lend. Pricing is described in relative terms only. Down payment, reserves, terms, and eligibility vary by occupancy, credit, LTV, loan size, and the deal, and are subject to change. All loans are subject to credit and underwriting approval. Not all applicants will qualify.
- Backed by
- Fannie Mae and Freddie Mac
- Qualifies on
- Your personal income, credit, DTI, and reserves
- Property types
- Residential only: single-family to four units, including condos and townhomes
- How many
- Up to ten financed properties per qualified investor. Couples and business partners each eligible for their own ten
- Terms
- Fixed-rate options, typically the most competitive investor pricing
- Down payment
- Generally 20% or more on a rental. Financing up to 85% is possible on a single-family rental, per current guidelines
- Best for
- Your first ten rental properties, and a very competitive cost of capital
An investor we talked to had been told he was maxed out at four properties. He had six Golden Tickets left and did not know it. The most competitive money he could get was sitting right there, unused.
Illustrative scenario. Details anonymized.
04 ·The Strategy
Spend them in the right order
Conventional is typically the most competitive money you can get, so use these slots first, and use them deliberately. Remember that a personally guaranteed DSCR loan spends a slot too. Put your Golden Tickets on the deals where the lower cost matters most, and let the math decide which deals get which loans. Sometimes DSCR outperforms a conventional loan, for example when leverage options run higher on a two-to-four-unit property. We will tell you when that is the case.
Watch two things as you go. The first is your debt-to-income ratio, which gets tighter as the portfolio grows. The second is your Schedule E. Depreciation is an add-back, so it does not hurt you with a lender who underwrites it correctly. The real pressure comes from other expenses, like travel and property management, which a conventional lender will not be able to add back. We help you maximize the deductions without making yourself unlendable. When the slots run low or DTI stops cooperating, that is the moment to pivot to DSCR and keep buying past the ten.
05 ·FAQ
Questions, plainly answered
Up to ten financed properties per qualified individual. A married couple qualifying separately reaches twenty, and business partners are each eligible for their own ten. The count applies to rentals: you could hold eleven financed properties and still get a conventional loan on a primary residence, because the guideline does not apply to your own home. We call those slots your Golden Tickets.
Keep Going
Related reading
Find out how many Golden Tickets you are actually sitting on.
Twenty minutes with a real person. No SSN to start. We count what you have left and map the order of operations for your next few deals.
Talk to a Human