Financing in Philadelphia>Question Details

audreykw1, Home Buyer in Philadelphia, PA

New Home Buyer: Mortgage Rates for owning/renting

Asked by audreykw1, Philadelphia, PA Wed Apr 10, 2013

My husband and I are interested in buying a two-unit home and renting out one unit. How does this affect mortgage rates? What would the mortgage rates be like for this? How would being first-time buyers affect it?

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6
If you have minimal funds for down payment and closing costs and/or your credit isn't top notch, FHA is the best bet. If you have more to put down and your credit is in the 700s, conventional will be the better bet for you. Connect with me at http://www.PaulCarson.com or 215-874-0125.
0 votes Thank Flag Link Sat Apr 13, 2013
Please take note you're asking a question about Mortgages so take the advise of a professional like Wes Costello who as you can tell is a professional. Always go to the professional in that field,the reason is simple they deal with all the canges in that field. So when it is Real Estate go to a REALTOR,when it's mortgage related go to a Mortgage Expert. If I can help wity RealEstate call me at 215=725-5700 X49

Philip J. Cunningham Sr.
V.I.P. Realty Corporation
7942 Bustleton Ave
Philadelphia, PA 19152 215-725-5700 X49
PhilCunningham2004@yahoo.com
Web Reference: http://www.GreatPaRE.com
0 votes Thank Flag Link Thu Apr 11, 2013
Some good answers on here already. Your follow-up question was,

"Because it's partially income property, can we get pre-approved for more than we normally would factoring in the income generated from renting?"

The answer is yes. On a 2 unit purchase the appraiser would develop an opinion of market rent of the 2nd unit. 75% of that rent would be used towards your income calculation. Therefore you would qualify for a higher purchase price.

Wes Costello
AnnieMac Home Mortgage
610-659-7014
0 votes Thank Flag Link Thu Apr 11, 2013
Audrey,

Congrats on starting your home search and considering buying a multi-unit property!
I would be happy to discuss your search further, as well as send you potential properties that meet your needs.
If you want to contact me so we can discuss privately, that would be great.

Thanks,
Jennifer
Jennphilarealtor@gmail.com
484-995-2155 cell
0 votes Thank Flag Link Wed Apr 10, 2013
You can buy a 2 unit with a Conventional(meaning non-FHA) loan with a minimum 15% down and rates are about .125% higher than they are on purchases of a single family home. If you go with the FHA loan you will have a lower base rate, but you will be paying mortgage insurance that never goes away, raising your rate 1.35%, plus you'll pay 1.75% of the loan cost up front(non-negotiable and set by HUD) pushing into not so competitive levels. If you can't swing the 15% down then you have to go the FHA route, but if you have the down payment you can have better options.

The one upside to FHA costs would be the very generous closing cost credits offered on FHA loans by lenders. You should definitely ask about them.

Being first time buyers would not affect your loan application in any way.
0 votes Thank Flag Link Wed Apr 10, 2013
Thanks for the info. Because it's partially income property, can we get pre-approved for more than we normally would factoring in the income generated from renting? Does that make sense?
Flag Wed Apr 10, 2013
Good evening,Audrey
You can purchase a 2 unit building with a regular FHA mortgage since you will be occupy one unit.Depending on income, you may be able to use a program to get you a 3.25% rate .
Please contact me to discuss specifics.
Don Sherman-SRES
Century21 Advantage Gold
Cellphone-267-716-8228
Email-realtor94@gmail.com
0 votes Thank Flag Link Wed Apr 10, 2013
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