Financing in San Diego>Question Details

Christie Law…,  in San Diego, CA

Hello, If I own a condo in Hillcrest which is underwater, am I able to buy another property if I an prove that I've rented the condo out?

Asked by Christie Lawrence, San Diego, CA Fri Mar 11, 2011

Would I have to show that I can carry both mortgages on my income or would I need to show that I have renter's income, and that it has been provided on two years tax returns? Thank you!

Help the community by answering this question:


Christie ,
Have an attorney review your mortgage agreement. If this condo was purchased as your principal residence I would make sure that you are within your rights to use it as an income property. The lender can call the note and that could force you into a different situation. Please take the time to verify and act on responsibly or the consequence may be alarming.
1 vote Thank Flag Link Mon Oct 31, 2011
Thank you all very much for your answers. I do not intend to walk away from my condo, I hope to have it for a long time. We have a 10 month old so we now need more space. It sounds as though there are options and it would be best to seek the advice of a lender. Thanks again!
1 vote Thank Flag Link Fri Mar 11, 2011
Hi Christie,

Because the property is currently underwater, you would have to qualify with both mortgages, full PITI on both properties. And, if the rental income does not show up on your taxes, you cannot count any of that income.

Best wishes,

Elva Wormley
Cobalt Financial Corporation
(408) 615-8500
1 vote Thank Flag Link Fri Mar 11, 2011
Hi Christine,

Generally you would have to show you can pay for both mortgages. I cant say for sure though.

I can give you a couple of recommendations on who to speak with to get prequalified.

Good luck,
Web Reference:
1 vote Thank Flag Link Fri Mar 11, 2011
You would have to have 30% equity or show you could carry both mortgages. There are ways to short sale and turn around and buy immediately. If you have any interest give me a call 858-210-5241. -Emily
1 vote Thank Flag Link Fri Mar 11, 2011
I was just looking through old post and I noticed yours. If you were not able to refinance at the time of the post, I can certainly help you out now. You can call me at 408-352-5147 or email me at You can check us out at I will look at your situation and present you with some options.

Alex Greer
NMLS #1056079
0 votes Thank Flag Link Thu Aug 15, 2013
It depends, if it is a primary residence you are vacating, you have to qualify with both payments to buy a new primary residence. If you have had it rented for a while and you don't live there, you may be able to use 75% of the rents. Many lenders have "overlays" where they require you to have the rental income show for 2 yrs on your schedule E. But there are some that will allow the rental income just with a lease.
0 votes Thank Flag Link Mon Oct 31, 2011
You have received good counsel in that: 1). You must qualify for both mortgages PITI and HOA and 2). You must have six months reserves (retirement funds can be used for qualification. However, you must also present a solid "case" to the underwriter that you are not going to buy a new home and then walk away from the mortgage on the property underwater. This a classic strategic walkaway situation and lenders are very skittish about contributing to another foreclosure. This is the "finesse" side of finance that needs addressing by letters of explanation, facts and evidence of intention. A good loan officer would addresss this prior to submitting to an underwriter.
0 votes Thank Flag Link Sat Jun 11, 2011
Hi Chrsitie - You'll have to show that you qualify for both loans with your income. The renters income can only be counted if you've claimed the rent on your tax returns.
0 votes Thank Flag Link Tue Mar 22, 2011

You will not be able to count 75% of your rental income in your debt-to-income ratio for qualifying, because you do not have 30% equity. You will need to qualify for both loans with just your household income. In addition to your down payment and closing costs, you will be required to have 6-months PITI & HOA Dues on your condo plus 2-months PITI reserves and HOA, if applicable, on your purchase.

Happy funding, Rudi
Web Reference:
0 votes Thank Flag Link Sat Mar 12, 2011
You may be able to purchase another home. It all depends on your income, credit and down payment. I would suggest checking with one or more of the lenders that you will find at this site : . I have worked with these lenders and they have a variety of programs and one of them may work for you.
Good luck

Jerry Heard - Broker
CA DRE # 00648687
0 votes Thank Flag Link Sat Mar 12, 2011
It's all about the qualification factor. You can own as many properties as you want if you have the money for the down payment, good credit and employment and the rental/s show a positive cash flow. Granted banks are a little more cautious nowadays with borrowers becoming investors but they are out there.
0 votes Thank Flag Link Fri Mar 11, 2011
Absolutely! As long as you can qualify for the new loan! When would you like to start shopping for a home? Give me a call, I am here to help.

Manny Lising | CENTURY 21 Award
Web Reference:
0 votes Thank Flag Link Fri Mar 11, 2011
Hi Christie,

I believe that you need to show one year's worth of rental income, but check with your lender to be sure; I can provide you with a few if you need them. Without rental income, you would need to prove that you can afford to carry both mortgages. This is done so that you don't buy another home, then walk away from the property that's under water, like so many homeowners have understandably done in the past.

Good luck to you!

0 votes Thank Flag Link Fri Mar 11, 2011
Hi Christie,

The very best thing is to talk to a lender given you will need a loan to purchase a new property. We would recommend that you talk to the person below:

Bobby Askari
Sr. Home Loan Consultant
613 W. Valley Parkway #230
Escondido, CA 92025
Office: (760) 270-9280)
Mobile: (619) 889-9024)
Fax: (866) 596-6195)

Best of luck to you,

Mark & Kari Shea
Shea Real Estate
Serving Greater San Diego
0 votes Thank Flag Link Fri Mar 11, 2011
Hi Christie,
although what most of these agent's responses are true, there are ways around it. You only have to qualify for both mortgages if it is your departing residence. I have a way that you can purchase another property even with your current property upside down without having to qualify for both.
Give me a call. I'd like to share this with you and show you how we've already helped a few in your same situation.

Daniel Di Matteo
Century 21 Award
0 votes Thank Flag Link Fri Mar 11, 2011
Yes. Buying is a possibility. It is best that you speak with a qualified Mortgage Consultant to see what the best loan option would be for you and if this will work for your unique situation. I always recommend:
Sean Courtney
Global Mortgage

Best of Luck!
0 votes Thank Flag Link Fri Mar 11, 2011
Emily , Nick and Elva are correct. Since you don't have 30% equity in your condo lenders will make you qualify for BOTH payments.

This is a perfect "buy and bail" type scenerio as lenders see it.
0 votes Thank Flag Link Fri Mar 11, 2011
You can show that you have renter's income but a bank will typically only allow you to count between 70-75% of it towards your income to account for times which the property may be vacant or when you don't collect rent on it for whatever reason. Different banks have varying degrees of strictness to this so its best to shop around. Please give me a call or shoot me an email if you're interested in discussing this further. I live in the University Heights area and have an extensive background in mortgage in addition to my Real Estate experience. I also have excellent client references that will tell you how much I value my clients and work for their goals. My advice doesn't cost a thing so feel free to call and pick my brain!


Sergio Casas-Silva
Safe Harbor Money Management
CA DRE License #01863531
(P) 858-405-3289
(F) 619-512-4421
Web Reference:
0 votes Thank Flag Link Fri Mar 11, 2011
You would need to show a little of both. You can buy another property with yours rented out even without 2 years tax returns, but if you have them your lender will love you. they are going to count only a portion of the rental income. The best place to check is with your lender. The rules changed at the first of the year. I have closed a couple of transactions this year with a similar situation.

Good luck!

Let me know if I can help you in any way!

Joan Wilson (Realtor, SRES, Ecobroker, Certified REO and Short Sale/HAFA Specialist)

California Cool 4 Sale
Prudential California Realty
Direct Phone: 760-757-3468
Fax: 760-946-7894
License # 01341483

It is my Goal to Increase the Success and Profitability of Those I Serve

Find your Dream Home:
0 votes Thank Flag Link Fri Mar 11, 2011
It really depends on how far upside down you are. Most likely you would have to qualify for both mortgages. The best way to figure this out is to contact a great loan officer. If you would like a recommendation I have an amazing LO I can introduce you to.
0 votes Thank Flag Link Fri Mar 11, 2011
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