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Need advice on mortgage approval with 2 rentals

I have my own rental and a SFH currently living with total of 340K mortgage.  I plan to rent out the current SFH and buy another SFH with my husband next yr and plan to have 360K mortgage.  We both have excelllent credit and stable income.  Will I get any problem with lenders for conventional loan with 10% down? or FHA with less down?  Will the rentals be a problem in the approval?
  • August 17 2012 - US
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Answers (2)

Best Answer

Will I get any problem with lenders for conventional loan with 10% down? or FHA with less down?

That is a pretty open ended question.   It all depends on your income, credit, assets and debts.   For rental property #1, the underwriter will look at your last 2 years tax returns, schedule E to calculate a positive rental cash flow (added to your income) or a negative cash flow (added to your debts)   On rental prop #2, it will depend on how much equity you have in that property.   If you have 30% equity or more and have a signed lease agreement and collected a deposit, then the underwriter will use 75% of the rent you collect to offset the total housing payment (including taxes and insurance)

Best thing to do is call a loan company to get prequalified. Even if you don't plan on buying until next year, it is never too early to look into what you qualify for.   That way if there is a problem, you have plenty of time to try to fix it.
  • August 17 2012
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Thanks.  Will go to a loan company. 
  • August 18 2012
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