2nd Home Purchase -- Loan Qualification

chmg2k · Joined: 22 May 2009 Posts: 1 1.78 Dollars($)

My wife and I are looking into purchasing a 2nd home that we would rent out to her parents.

My question is, how tough would it be to get approved for a loan on the rental property and would we be able to get a reasonable rate? The house would be around $140K and we could put down 20%. How tough is it today to get financing on a rental home?

We both have credit scores around 800, make 125K a year, and have no other debt than student loans. We currently owe $200K on a house worth around $225K.

sunil87020 · Joined: 04 May 2009 Posts: 263 0.00 Dollars($)

I am not gettingyour query.
As you specified you want to buy 2nd home right.... and after that you will give it to rent to your wife's parent then where is the problem for rental loan. You will purchase the home 1st and after purchasing you will gve to rent then i think there will not be problem.
Please right specific if I got misunderstood your query.

savior70 · Posted: Sat May 23, 2009 3:36 am Post subject:

Hi

You shouldn't have any problem in financing the rental property. Your credit score is impressive, you're ready to put down 20% and you do not have too much of debts. These facts are expected to work in your favor when the lenders will consider giving you a loan. Contact your local lenders and discuss your options with them. Alternatively, you can opt for a no-obligation free consultation with the community lenders who'll assess your financial situation, credit score etc and will tell you if you can qualify for a mortgage. They would also be able to suggest you what type of mortgage will be best suited for you. You can then weigh your options and choose the right loan for you.

Niicss · Posted: Sat May 23, 2009 3:38 am Post subject:

Hi chmg

As you want to rent out the property, it would be considered as your investment property. If you have a good credit score and stable income, lenders would readily give you a mortgage. I appreciate that you have a credit score of 800. I hope, you don't have any other negative items on your credit report apart from the student loans.

I would suggest you to speak to the lenders about getting a mortgage. This will help you know the rates and terms prevailing in the market. You can also speak to the lenders of this community and seek consultation from them (Check out the link given by Jenkin). This will let you know whether you qualify for the loan or not.

Thanks.

robertsmith2005 · Joined: 22 May 2009 Posts: 338 -0.52 Dollars($)

you are qualifying all the conditions & therefore can get good interest rate.

gmakerley · Posted: Sat May 23, 2009 9:06 am Post subject:

an investment property is not a second home, by definition. you will pay additional costs in connection with your mortgage for purchasing an investment property. be prepared for that.

eric1 · Posted: Sat May 23, 2009 5:34 pm Post subject:

In addition, your down payment requirements will most likely be different than a second home.

manoj_gopale · Joined: 16 Feb 2009 Posts: 488 0.00 Dollars($)

Your & your wife's credit score is pretty good.In my opinion if the person who is supposed to avail the facility of the house (her parents.) if they can be added in the equity then surely you will be able to get the loan.

As you currently owe 200 K on the 225 k property so still it is a big burden on your head.

keep in touch.

gmakerley · Posted: Tue May 26, 2009 7:29 am Post subject:

manoj: HUH?

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