The Difference of Traditional and Rental Property in Key Biscayne Real Estate Market
The common choices that are available in the market are those traditional homes and rental properties. These two options have their similarities and differences. If you cannot make up your mind which is a better choice for you, here are some of the key points that can help you.
In terms of credit score
A both traditional and rental property in the Key Biscayne real estate market requires a significant credit score. If you are not used in ordering your credit score reports from the three crediting bureaus, then you should start now and review your record if there are any errors and bad remarks. It is always crucial to polish your credit reports ahead of time before you start searching, buying or renting a property in Key Biscayne real estate.
Normally lenders will require you to have a good score when applying for a mortgage loan for the purchase of Key Biscayne real estate property; landlords will also do some background checks on your financial status which typically include looking into your credit score. If you are not ready with this, you might miss your chance at a good rent or purchase.
Debt-to-Income ratio
The debt-to-income ratio is probably unique to traditional home homebuyers. Lenders are the one who will use this ration in order to gauge your risk-level. And since rates are going down, lenders are typically getting risks aggressive when it comes to whom they will grant the loan. It is very important to ensure that you are earning more than you are paying every month.
With this you have to compute all the debts that you are paying every month and divide the total number of debts; and then you have to compare the average amount that you are paying for your debt against your monthly income. If your debts are closer or higher than your income monthly, then it will be harder for lender to approve your mortgage loan application, since you will be considered as a high-risk borrower.
Future Plans
Another area where traditional properties and rental properties in Key Biscayne Real Estate differ is with your future plans. You should not take the challenges of owning a home in Key Biscayne if you are only planning to stay in the city for less than five years. With this, it is better to have rental property in Key Biscayne, which can be lease either on a monthly basis or short-term basis that usually lasts for couple of three years.
Ella Ayson
Key Biscayne Real Estate
