Home Buying in Walker>Question Details

Shannon Gull…, Both Buyer and Seller in Baton Rouge, LA

Buying a new primary home after Rural Development.

Asked by Shannon Gulley, Baton Rouge, LA Wed Feb 12, 2014

I bought my first house with a Guaranteed Rural Development loan in August 2011. It is a 2 bedroom 1 bath 995 sq ft I have since gotten married and have a step son. Step son does not live with us full time but every other weekend and most of the summer. The 2 bdrm 1 bath house is just too small for us now. Can we purchase a second primary home with a FHA or Conventional loan and rent out to 2 bdrm? Am I required to sell the 2 bdrm since it will not be owner occupied? Can you have an RD and FHA loan at the same time?

FIY- We CAN NOT sell the 2 bdrm house FIRST. We have goats that would keep us from renting out a temporary house between selling and buying. Buying then selling/renting is the only option. I realize we would have to qualify for both mortgages first.

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Answers

3
Hi Shannon,

You need to go back and read through your promissory note just to make sure there isn't anything in it prohibiting you from renting out the home. USDA has pretty strict guidelines when it comes to people buying a home, like the guideline that the home can not be an income producing property. The flip side of the coin is qualifying for your new mortgage. In your case, you will have to qualify for your new mortgage without counting the rental income from your current home as a way to offset that mortgage payment. FHA is going to be more lenient as far qualifying for the a new mortgage & yes, you can have an FHA & USDA mortgage out at the same time. The other option is you could try and buy your new home contingency which just means your new home purchase is contingent on you selling your current home. This would allow you to close the sale of your current home and then turn around and close on the purchase. This is know as doing a back to back closing. Check out my recommendations here on Trulia from some of my past clients by clicking the following link. | http://www.trulia.com/profile/johnburke/#__rec | Please feel free to contact me for more information or help. | John Burke | Senior Mortgage Banker | Peoples Bank & Trust | (877)228-9069
0 votes Thank Flag Link Thu Feb 13, 2014
Please contact Kenny dykes with Homeowners mortgage in Baton Rouge. dykes.kenny@gmail.com (225) 328-8995. He is great at working the different programs and I am positive he will give you good advice.
0 votes Thank Flag Link Wed Feb 12, 2014
The general answer to your question is yes; you can purchase a a second home and rent out the other property. Whether it is USDA, FHA, or Conventional--you just need to fight the program that fits your individual needs best. In order to answer your questions completely we would have to examine your situation. Feel free to contact me at 720-279-8857 or dricketts@englending.com, as we have the ability to lend in all 50 states. :)

Regards,

Dave
0 votes Thank Flag Link Wed Feb 12, 2014
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