My situation is this, I currently make 125k a year with an additional 25-75k in bonuses depending on gross margin for the year (evaluated and payed quarterly). I bought a condo in 2007 for ~350k and my monthly mortgage is about $1400 plus 350 in condo fees. I know it seems like I make a lot of money but I cannot afford a down payment at the moment for reasons as follows: Parents lost job and I'm paying for their mortgage, and all my savings was put into my condo. Would I be qualified for a 100% finance or very low downpayment mortgage? I can very easily rent my condo for about a break even price since it is close to the metro, but I believe that it may be worth about 50k less than what I paid for it although in terms of my remaining mortgage and market value it's about break even. by emamjo_107_604 from Alexandria, Virginia. Oct 25th 2012
If you are a Vet with VA eligibility, yes. Otherwise, No. You would be looking at a minimum of 5% down, with pretty high PMI fees to boot. You will have to qualify without any consideration of potential rental income on the place you intend to rent. Even if you have it under contract, none of it will be considered until enough time has passed to show that your rental income is consistent. It is also very probable that you would be required to have at least 6 months worth of payments for both loans in the bank AFTER all of your cash needs to make this purchase. Work with a local Mortgage Banker/Broker to see what you will qualify for. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ Licensed in California and Arizona ~ www.LoansA2z.com 888-889-9950
Bert is correct.. VA if your eligible, otherwise, just not going to happen... Lenders are very aware of a strategy called "buy and bail".. Meaning you purchase a new home and tell the bank you're going to rent out your current home.. Only when you close on the new home, you let the other home go back to the bank.. I'm not saying that's your intention, but the lender will think this is everyone's intention within this given scenario... so they will be very cautious in underwriting a file like this.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com
What I would suggest is if you really want to purchase an additional condo and have little or no money to put down, but can manage the payments, then I suggest offer to take over payments of someone that may not want their condo or ask to do either a lease option contract or a rent to own contract. How these work, you ask? Let's start with taking over payments. This may be the least advantageous because the potential owner may be upside down on the property or facing a default. I would only do this scenario if the owner would provide me a letter indicating that I would be the power of attorney, that way I would have the right to discuss the loan with the lender. The next option I suggested was the Lease Option contract. This allows you to lease the real estate until you are in a better position to buy and then you would activate the option contract as your purchase contract at a future date. The last suggestion is simply to lease the property until you pay it off. Typically, you would want to approach the owner and ask if he would be willing to allow you to rent to own. In other words the owner would be considered the lender and you would not have to qualify based on income or credit, even though you profile seems quite good. If you have any questions or would like to know how to structure these suggestions, just give me a call. Best of luck and I want you to know that all these suggestions have been used for many decades.
The fact that it is a SFR and not a condo, does not really change the circumstances. The underwriting standards are going to be the same. The pricing may be a little better on a SFR than on a condo, but use of rental income and required reserves still apply. No one ever says they are going to buy and bail, but enough have done it that the banks look at every new borrower with held property with negative equity ($1,000 or $500,00 negative equity) the same skeptical way. Work with a local Mortgage Banker/Broker to see what you will qualify for. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ Licensed in California and Arizona ~ www.LoansA2z.com 888-889-9950
The fact that it is a SFR and not a condo, does not really change the circumstances. The underwriting standards are going to be the same. The pricing may be a little better on a SFR than on a condo, but use of rental income and required reserves still apply. No one ever says they are going to buy and bail, but enough have done it that the banks are all skeptical if the remaining property has no or negative equity. Work with a local Mortgage Banker/Broker to see what you will qualify for. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ Licensed in California and Arizona ~ www.LoansA2z.com 888-889-9950
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