Paying more on your primary residence can actually hurt you in that you are depleting assets, which the bank wants to see (as in lots of assets). You will need two months reserves (PITI & HOA fees) for each property you own AFTER the purchase is completed. So save those dollars before you buy.
On an investment property purchase, you will need a minimum of 20% down for a conventional loan. You could look for a condo being sold by Fannie Mae using their HomePath financing program with just a 10% down loan program for investors with no mortgage insurance.
You can buy your primary residence & the investment property on the same day, or the next day. There is no waiting period.
Good luck on your purchases!
All the best,
Roswell Moore, CMPS
Certified Mortgage Planner
We are a Direct Lender, Mortgage Bank where we originate, process, underwrite, fund, AND SERVICE our loans, in-house, FHA (starting at a 580 score AND only 3.5% down), FHA Streamline loans (no minimum credit score, no appraisal required) Go Green rehab loans, HomePath, Investor Friendly (10 financed properties), VA, USDA, Jumbo, Conventional, plus, we allow Escrow hold backs!
After you are in the property which will be your primary residence, make sure all your payments are on time.
Once you have this debt, remember it will have a large impact on your debt to income ratio. This is an important determining factor for qualifying for a loan. In my opinion, it's not the equity you have built on your first property, but the equity you will invest in the second property, that will make more of a difference. You always have to put more money down on a property that will not be your residence. The lender needs you to be "invested", in some way.
I am a Realtor, and not a banker or loan officer, but if I were planning this , here's what I would do. I would put down enough money on my residence to get a loan without PMI. That will lower your monthly payments. Having a prospective tenant who is willing to write a letter to the bank saying he/she will be leasing the property once you have closed is also very helpful. If you dont have that, then make sure you look to buy a property in a place that has a proven record of renting quickly. And that information is all on the MLS. A good Realtor will give you that information. It's wonderful to see someone who is planning on making investments in Real Estate. I wish you the very best. And of course, if you aren't working with an agent already, please contact me. 908-447-6980.