You're wrong. If JC needs the rental income to offset the existing mortgage to qualify for the new mortgage, the amount of equity he has in his current home absolutely matters unless he's relocating for work and getting an FHA mortgage. Look up buy and bail guidelines for FHA & Fannie Mae.
Pay attention to what Sally wrote below as this is a real deal killer. I see that you're in AZ but posted this question under buying in Atlanta so are you actually looking to buy a new primary residence in Atlanta? If so why, were transferred for work? I'm setting out reasons that can possibly make a difference in whether or not you get approved for a mortgage on a new primary residences VS having to buy as an investment property with 20% down.
Please feel free to contact me for more information or help.
Peoples Bank & Trust Co.
Just one more thing to be concerned about in an already complex financial world.
Under the new Buy and Bail guidelines we would need to document that your existing loan is in good standing and we would need to document the type of loan it is.
apply online: mdangelo.brandmortgage.com
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If you only refinanced two months ago, you would not be able to qualify for a new primary residence mortgage was at least 12 months from the refinance. When you do a refinance of a primary residence, it must be your intent to occupy the property as such for at least the next 12 months.
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This sounds feasible, but you really need to contact a lender in the market where you want to buy. Lending regulations can vary from state to state, but more importantly, you will need to spend some time with a lender going over the specifics of your financial picture. Give me a call if you need a lender to speak with.
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I used to do these deals all the time (where a well heeled buyer wanted to buy a certian home before it got away without waiting for thier existing home to sell) they would line up a renter and only had to show a one year lease on the existing home and one year reserves only for then rental, and if they had enough income they could buy the new home - all that has changed. The last time someone contacted me with that idea was at least 5 years ago and if I recall, the lender wanted 24 months reserve on the rental and 18 on the new home - that couple did not have the both the 10% DP and heavy reserves and passed.
I understand the AZ market is on a big uptick - why are you wanting to become a landlord rather than selling?
You really want to be addressing questions of this import to a few lenders in the city where you intend to buy the new home - I would not trust an agents to answer this type question. And since the existing home will become a rental (investment property) you need to start calling the new home you want to buy your primary residence because it will be. A second home is where you actually have two homes that you use part of the year and neither is leased out - that scenario requires one to be able to qualify for a second loan and pay for both mortgages.
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Best of luck to you.
Sounds like a great question for a local Loan Officer. Did you like the lender you used for the refi? If so, go back and ask them this question. I'm guessing there's someone who will do it, but you'll get stuck paying PMI. Best of luck...