Financing in Bellevue>Question Details

tananate, Home Buyer in Bellevue, WA

Looking to rent out our house. Can we get another FHA loan or a conv. loan and wry about putting down 5% and prove we can support 2 mtg pymts?

Asked by tananate, Bellevue, WA Thu Sep 13, 2012

We currently have a FHA loan and have owned our house 5 years and updated it.

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Answers

4
FHA generally prohibits someone from having more than 1 FHA loan, but it allows some exceptions.

You can have more than 1 FHA loan under a few situations:

1. Relocating to a new area not within reasonable commuting distance from their current principal residence (doesn't need to be employer mandated).
2. Increase in family size to where the present home no longer meets the number of legal dependents needs, you also need 25% equity in the departing residence with an FHA loan.
3. Vacating a jointly owned property, like in the situation of a divorce where one spouse remains in the home and the other moves to a new home.
4. If you co-signed on someone else's FHA loan, then you can get an FHA loan to purchase your own home... like if you co-sign for your children's FHA loan, you can get your own FHA loan afterwards.

If you are using a conventional loan to purchase, then none of the above guidelines apply. However there are additional guidelines (by both the mortgage lender, and with less than 20% down then also the PMI company) on what the qualifications are - mainly in the amount of financial reserves (i.e. checking, savings, retirement, etc.) you would need. It's possible to put just 5% down (or even 3% down) on the new purchase with conventional financing, regardless if you already have a home you plan on keeping, or not.

Shane Milne | Lending in all 50 states | NMLS #81195
0 votes Thank Flag Link Fri Sep 14, 2012
You can only have 1 FHA loan and you can qualify for a conventional mortgage as long as you qualify for both mortgage payments (no credit for rent) and you may need additional reserves depending on the loan to value with the home you're converting to a rental.
0 votes Thank Flag Link Thu Sep 13, 2012
There are so many ways to look at this, but in order to answer the question I have to ask you a bunch of questions first. Feel free to contact me if you want to talk. I am both a loan originator & a real estate broker & would be happy to help you figure it all out.

Good luck,
Jirius Isaac
Isaac Real Estate Team
Champions Real Estate Services
TriStar Finance #MLO-107799
Office: 425-483-6849 Cell: 206-841-9976
Winner of Seattle Magazines 5 Star
Real Estate Agent Best in Client Satisfaction Award
Mortgage Loan Originator Best in Client Satisfaction
0 votes Thank Flag Link Thu Sep 13, 2012
you can get an FHA loan or refinance if you are still are an owner who occupies the home.
Gary Roth 206 714-8107
0 votes Thank Flag Link Thu Sep 13, 2012
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