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Answers (8)
- Kelly Lacey, "kellylacey"
- Contributions:797
Why don't you just let this one die off...original question is from over 1 year ago so I'd like to think they received the answer they needed...
- Jim Curry, "Lake City JEC"
- Contributions:44
Your lender is the one who would do the best in answering this question.
- Adam Duckwall, "adamduckwall"
- Contributions:3
Yes, you do have options, however, this is going to be dependent on meeting the guidelines of the loan program that you are buying under. The guideline that I see catching people off guard most lately is the "buy and bail" rule. This guideline was put into place to prevent people from going out and purchasing a new home "non-contingent" on the sale of their current home, and then proceeding to let their previous home fall into foreclosure. As a preventative measure to this, most lenders are going to require 6 months of reserves in your bank account to pay the mortgages on both your properties. If you have the cash on hand, this shouldn't be a problem.
FYI, I am a Realtor and not a loan officer, so as you have seen in the previous comments, I am going to recommend that you check with a loan officer to get clarification on this, but I don't think this guideline is going anywhere soon.
I'm guessing that you don't have a history of renting out properties, so you most likely will not be able to use the rental income as qualifying income for your purchase. It sounds like you were not trying to do this, however, it would be a logical question.
Adam Duckwall (Edina Realty, St. Paul)
FYI, I am a Realtor and not a loan officer, so as you have seen in the previous comments, I am going to recommend that you check with a loan officer to get clarification on this, but I don't think this guideline is going anywhere soon.
I'm guessing that you don't have a history of renting out properties, so you most likely will not be able to use the rental income as qualifying income for your purchase. It sounds like you were not trying to do this, however, it would be a logical question.
Adam Duckwall (Edina Realty, St. Paul)
Contact your lender. They know your specific circumstances and will be able to answer your question better than any of us can.
- Barb Hauge, "movewithbarb"
- Contributions:79
Only your lender can answer that question for you. They are the experts regarding financing but also your motgage broker will know your specific information.
- Susan Hofflander, "shofflander"
- Contributions:42
Charlynmarie,
It's important for you to have professionals working for you. Did you ask your agent about this?
As the other agents have said here, you being able to purchase another home and keep the one you have is determined by the underwriting process, not by an agent or any one individual. The lender will be examining your financial picture to see if your debt to income ratios would still allow you to qualify for payments on the new house, because, on paper, you'd still be financially responsible for the other house.
Another thing to check is to see if your CURRENT lender allows you to rent the property. There are a few loans that will only allow you to occupy the property, and stipulate that, if you are going to move out, you have to sell it and pay off the total owed on the mortgage.
Good luck!
It's important for you to have professionals working for you. Did you ask your agent about this?
As the other agents have said here, you being able to purchase another home and keep the one you have is determined by the underwriting process, not by an agent or any one individual. The lender will be examining your financial picture to see if your debt to income ratios would still allow you to qualify for payments on the new house, because, on paper, you'd still be financially responsible for the other house.
Another thing to check is to see if your CURRENT lender allows you to rent the property. There are a few loans that will only allow you to occupy the property, and stipulate that, if you are going to move out, you have to sell it and pay off the total owed on the mortgage.
Good luck!
- Joe and Cindy Welu, "Joe and Cindy Team"
- Contributions:6659
This would definately be a question for your lender...it may not depend on the price points of the properties, but of your ratios, credit scores, how long your current property has been rented, etc.
- Kathleen Wray MA, ePro, "realtorkathy"
- Contributions:130
Talk to your lender, as it sounds like you might have to sell you home first. Do you have enough for both payments in case your tenant defaults?
Do I have to sell my current home to purchase another home?
I currentl found a home for $169k and would like to keep my other property as rental.
Do I have any options?
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