our lending criteria
Success in real estate investments begins with the right property choice.
To assist our investors in identifying the ideal deals, we've developed a comprehensive, 6-point guide. This ensures that your investment not only offers promising returns but also stands resilient against market fluctuations.
At ArrowCap, our foremost goal is to fund projects that optimize success chances. Our lending criteria, therefore, revolves around these pivotal 6 points:
Credit Score: A higher credit score (680+) boosts your eligibility.
Down Payment: A minimum of 20% down payment is preferred.
Property Units: Focus on properties with 1-4 units. This broadens the appeal to a wider market segment, including FHA buyers.
FHA Compliance: Ensure the property is priced at or below FHA requirements, which widens the potential buyer base, especially first-time homebuyers.
Property Size: Smaller homes with a maximum of 5 bedrooms and 3 baths are preferred. This aligns with the current market trend favoring compact homes.
Land Area: Properties should ideally span less than 1/2 acre, simplifying maintenance and reducing expenses.
why this criteria?
Why the emphasis on FHA cap?
Properties compliant with FHA limits have historically shown resilience against drastic value fluctuations and are less prone to market depreciation.
Why 1-4 Units?
Properties within this range attract a larger market segment, enhancing your property's appeal across diverse demographics.Why the focus on smaller homes?
Both Millennials and Boomers, the two dominant market segments, show a preference for smaller homes. While Millennials are just starting their journey, Boomers are often looking to downsize. As observed by Candace Taylor of The Wall Street Journal, modern buyers across ages are veering towards smaller, contemporary homes.Why less than 1/2 acre?
Reduced acreage translates to lesser upkeep, aligning with the preferences of both Boomers and Millennials. It also ensures reduced maintenance expenses.