Montana is a great place for real estate investing; the low cost of living means that property is quite affordable, and the state has incredibly low property tax rates.
The effective tax rate is only 0.74%, which is far lower than the national average of 0.99%.
There's also a robust tourism economy thanks to the eight national parks in Montana, netting $618.9 million in tourism revenue in 2020. Glacier National Park and Yellowstone are the two most popular, which receive about 3.6 million annually.
All these tourists need hotels, restaurants, and shopping options, which represents a great boon for investment properties.
One of the reasons that real estate investors love Montana DSCR loans is because, unlike a conventional mortgage, a DSCR loan is almost entirely focused on the property's ability to generate sufficient cash flow rather than their finances.
To access DSCR loans, you don't need to show tax returns, pay stubs, or your debt-to-income ratio: all lenders require is a reasonable credit score, a down payment, and proof of the property's cash flow.
To determine a property's cash flow lenders will use a DSCR calculator to make sure the property's rental income is higher than the principal, interest, association dues, taxes and insurance (PITIA).
A DSCR loan application is fast and efficient, meaning borrowers can start building a real estate portfolio quickly.
The primary concern with DSCR loans is the property's ability to generate sufficient cash flow to cover loan payments rather than the borrower's financial profile, as evident from the stipulations for DSCR loans in Montana.
Interest rates for DSCR loans are about 1% to 2% higher than for a conventional loan, but you can refinance for a lower rate. You'll have a prepayment penalty if you make loan payments ahead of schedule.
Home to the fascinating rock formations known as the Rimrocks, Billings is also known as Montana's Trailhead for its proximity to the dramatic Beartooth mountain range.
Though small, Billings is in the world's top 28 most expensive cities compared to its cost of living, making it one of the most competitive places for DSCR loans in Montana.
The median rental income here is $1,300, while commercial spaces make approximately $10.75 per square foot.
Beautiful Bozeman is one of the best investment opportunities for those pursuing short-term rental property, as the surrounding Rocky Mountains are known for many outdoor recreational activities.
Accordingly, Bozeman is more expensive than other areas, with rents of about $2,600. The average commercial rental income is about $31.26 per square foot, making it quite pricey compared to Billings.
Great Fall's long-standing commitment to hydroelectric energy makes it a promising place for sustainability startups, and commercial investment properties are promising here. Rental income is around $1,232 monthly, while office rental property costs about $14.73 per square foot.
The state capital is affordable for residential and commercial spaces: the median rent is $1,495. Retail spaces net about $7 per square foot, while office spaces are around $14 per square foot. A DSCR loan can put you far ahead of the competition when seeking investment opportunities here.
If you're ready to seek investment opportunities in the Rocky Mountains, let us help you with DSCR loans in Montana. We've helped thousands of real estate investors access the loans they need to purchase or refinance excellent rental properties.
DSCR loans in Montana are America's best-kept secret - and Visio Lending wants to help you become one of those lucky investors. Contact us today to get your DSCR loan process started.
Check out some of Visio Lending's recently closed DSCR loans in Montana.
Big Sky, MT
Bozeman, MT
Butte, MT
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Visio Lending is the nation's premier lender for buy and hold investors offering, long-term loans for SFR rental properties, including vacation rentals.