Though I am not a Mortgage expert, However, first thing you need to know that Of your total rental income, the banks providing loan to you will consider 75% as your income which is a good thing.
Also, you can buy this home as a primary residence provided the new home you buy is larget than the existing home you own in another state.
Furthermore, with downpayment you mentioned and depending on your income, my advise is to go with FHA Loan where you need only 3.5% down.
I do not believe any banks provides conventional loan under 10% down. I can recommend some very good lending institutions to you.
There is still a lot to discuss. I strongly recommend to give me a call and I can discuss further or else I'll keep on typing for hours. My Cell# 732-277-9321.
Hope to talk to you soon,
I didn't realize the info you provided on FHA mortgages. I'll also check that out and see where that takes me. But again, thank you both for your info.
Have you looked into FHA mortgages? You only need 3% down and they do not look at credit scores when issuing mortgage loans. I have heard that you do need to be current with your credit cards, though.
Regarding the rental property you own, you might want to consider doing a 1031 when you are ready to sell that or you could be faced with paying capital gains tax when you sell. However, to do a 1031, you have to follow the guidelines and purchase "like" properties. Meaning that if it has been a strictly investment property, you will not be able to purchase a primary residence and do a 1031 exchange.
To find rent to own properties in your area, contact a good realtor in your area. I'm not familiar with Somerset's MLS, but in my area, we can search properties with that criteria and notify clients when new ones come on the market.
I have not seen any sellers specifically looking to do a land contract, and that's probably because they are unaware they exist. Again, a good agent who is willing to do the work for you is your best bet. Find one who is familiar with land contracts to help you. They are very "pro-seller" and you can lose everything if you default on even one payment, so be careful! Be sure to have an attorney look over any contract to be sure you are protected.
You basically should hire a realtor. In addition to local MLS info a good realtor will have a datebase of investors/land owners who can assist you in achieving your goal. Trying to do this on your own is possible but will present some challenges. Find a good buyers agent who service your area.
Jeremy S. Hill, Realtor
Keller Williams Realty
1814 Route 70 East
Cherry Hill, NJ 08003
"Your Interest 1st Always!"