Home Buying in Atlanta>Question Details

C Gina, Both Buyer and Seller in Alpharetta, GA

What are the requirements to purchase a second home and have the first one rented out?

Asked by C Gina, Alpharetta, GA Tue Apr 30, 2013

I own a townhome in Alpharetta, but would like to upsize, possibly into a duplex, closer to the city of Atlanta, and rent out the townhome. I purchased the townhome in 2007 for $142k and it's currently underwater. Theres a balance of $129k and even with all the upgrades I've made, I'm being told its worth about $100-$110k. What would be the requirements to purchase another home? I'm single my income is $75k and credit is 700.

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Gina,

You should be fine as long as your income can support both mortgage payments and all other outstanding debts. Due to the lack of equity in your departure residence (less than 30%) you can't use rental income to offset that mortgage payment for qualification. Most banks will require you to have at least 6-12 months PITI for both properties held in assets. As far as your new purchase your existing home will only effect you if the departure residence has a FHA mortgage, you can only have 1 FHA mortgage at a time, with a few exceptions. Other than that you can qualify for a conventional mortgage with as little as 3% down. I'd be happy to assist you in any way that I can. Good luck to you.

Sincerely,

Chris Irvin
Mortgage Banker
Brand Mortgage
NMLS # 75615/465546
678-251-7889
cirvin@brandmortgage.com
http://www.chrisirvin.com
0 votes Thank Flag Link Wed May 1, 2013
Hi Gina,

Pretty much you are likely looking at placing 10% down on your next home. Other than that there aren't many requirements you will have to jump through.

But since it is a townhome I would check with your HOA and see what kind of restrictions you may have in the community. Sometimes the HOA has a waiting list due to the fact they may not want a lot of renters in the community.

If you have anymore questions feel free to give me a call anytime.

Tyler Willis, REALTOR®
Keller Williams Realty Intown Atlanta
621 North Ave NE, Suite C-50
Atlanta, GA 30308
Office: (404)541-3500
Direct: (678)656-5524
tylerwillisintown.kwrealty.com
1 vote Thank Flag Link Tue Apr 30, 2013
Hello C Gina. You may not have any problems purchasing an additional home provided your current financial obligations do not exceed a certain percentage of your income. However, you are under water with your current loan in part due to you not making a substantial down payment (20%). For example, if you had put 20% down on your current home you would have more options at this point such as refinancing to a lower rate than you were offered in 2007. Refinancing of course would lower your monthly payment and if you decided to rent the home you could increase your passive income. It definitely would not be a bad idea to consider a significant down payment on the next purchase and this can help put you in a better position moving forward. I wish you the best.
0 votes Thank Flag Link Wed May 1, 2013
Hi C Gina,

Please contact me for a Broker Price Opinion - there are a few possible options that may work based on the numbers.

Best,

Robert Whitfield
Broker/Owner
Professional Buyers Broker
New Home Construction Expert
ICC Code Certified Building Inspector
Advantage Realtors
678-585-9691
RobertWhitfield.com
TheHomeBuyersRep.com
Corporate Relocations | New Construction | Luxury & Investment Properties
0 votes Thank Flag Link Wed May 1, 2013
Gina,
Where is your townhome?
When did you check what is your home worth? I live in Alpharetta - I would like to give you a price opinion. You can email me or call me.
Thanks,
Maria

Maria Vassileva
Realtor ®
BHGRE Metro Brokers
Office: 404.843.2500
Mobile: 404.409.9750
Fax: 770.645.7201
0 votes Thank Flag Link Tue Apr 30, 2013
Hi Maria, I live off of Windward Pkwy. Can you send me your email address? I can send you my exact address.
Flag Thu May 2, 2013
Gina,

Call me anytime tomorrow or this evening up to 10 PM on my cell phone - 770-864-7926.

I am a local mortgage banker close to you in Alpharetta and welcome the opportunity to help you through the qualifying process.

Regards,

Greg

Gregory J. Peters
Sales Manager | Evolve Bank & Trust
11605 Haynes Bridge Road Suite 125| Alpharetta, GA 30009
gpeters@getevolved.com
770-255-3835 | fax 678-387-1435 | cell 770-864-7926
NMLS#: 162522
0 votes Thank Flag Link Tue Apr 30, 2013
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