B

you might have a hard time getting a mortgage of any value with 2 rental properties hitting the debt to income ratio-- especially since it won't be rented at the time of your closing (as you'll still be living there). Talk to your lender about that option before you get set on it.



Wolcott is closer to the highway than bristol/burlington/etc so if you are considering moving there, you're all in the same ballpar commute wise.

corvetteguy78

no, the mortgage guy at webster bank was the one who recommended we do it that way....they key is to have a rental agreement at the closing.

I really think Bristol is out and Burlington was never an option :P

Bob Vila

the mortgage guy /= the underwriting guy. The U/W guy makes the final call. I'd be very leery of that...

J

If you can pull it off, it'd be great amigo. Make that money work for you. But save, save save just incase they go unrented. That's some pressure.

corvetteguy78

Yeah....I figure when we are ready to buy...we will have around 45k....only going to use about 20k for dp ... 5k to furnish....another2-3k for misc... rest is going to savings

J

Yeah can be done. Just be smart and frugal. I know people that lost their shirt when their houses went unrented for a while. Just depends on the market and location.

B

The key is to be able to pay all your bills, eat, gas, etc, and be able to pay all 3 mortgages should they be empty if necessary solely on your main job income.

The second you rely on at least a 50% fill ratio is when you get in trouble.

And then there's money for damages/fixes, etc etc and the time that goes in to being a landlord when stuff breaks.

corvetteguy78

Condo is on CL for rent, already got 1 showing scheduled for tomorrow. ..We narrowed it down to about 4 houses...We are looking at a house tonight....we already drove by the neightborhood and house, it's really nice. It's in Meriden but the nice part of Meriden. 5 minutes from the highway but you can't hear it at all. I made sure of that. Very residential area.

93 Stephen Dr Meriden CT - Home For Sale and Real Estate Listing - MLS #N328880 - Realtor.com®

Check it out on google maps.

B

Meriden has a prety high mill rate. something to keep in mind.

corvetteguy78

yeah got it all figured out already....taxes are about $6893/y (i used 8k in my budget) mill rate is 34.70, assessment is 198,666

corvetteguy78

Well B you may be smarter then the first mortgage guy i talked too at Webster Bank. He indicated to me all we needed was a rental contract and a deposit from the renters and he could use 75% of the rental income to include in our income when applying for the mortage. This would have qualified us for way more then we need.

Well he was dead wrong. Not only does it not count in the income, it also gets used on the expense(debt) side. It's a doulble negative.

Thank god I shopped around and found a guy who knew what he was doing. The government no longer allows banks to include rent for purposes of income when the rental property doesn't have atleast 30% equity in it. People were getting their houses and just walking away from the mortgage on the rental.

Right now we are very close to still qualifying. It's still in the works. It's not looking the greatest but he may be able to pull it off. He ran it with 5% down initially, i upped it to 10% down which should convince the PMI company's to insure the mortgage.

We'll see..if not we will wait it out 6 months or so, save even more money, get our scores up and try again.

It's gonna be a close one but if i was a betting man i would bet it doesn't go through.

If not we will just have to work on getting our credit scores up, mines ok hers is what is killing us. Our mid scores are 662 and 634.

__________________
Goodness Reflects the Light; And Evil Bares the Seed to all Darkness; These are Mirrors of the Soul; Reflections of the Mind--Choose Well

B

Why not just sell the place? you can always pick up another rental a few years down the road when you're in a better finanical place.


Another thing to consider is if you currently have any kind of FHA style mortage on the condo. Those mortgages are specifically for owner-occupied places. And if you no longer live there, you are required to re-fi out to a conventional.

corvetteguy78

Well if this doesn't work out we'll have to talk about selling. The problem is its going to cost us $31,000 to sell her place due to it being upside down. We could move back into my condo and live there and save up and try again next year and try to sell my place at the same time or just rent it again. At least her condo would be gone and our DTI ratio will be very low.


I'm not to sure about the re-fi comment. I think because it's been over 5 years that the rule does not effect us(i can't confirm that though). I know that when i got my CHFA i was tol i had to occupy it for 5 years. She has been in hers for over 6. Also how can you re-fi an upside condo without it being fannie or freddie backed? She is already higher then the current rates at 5.375%

just have to wait and see how it all plays out

__________________
Goodness Reflects the Light; And Evil Bares the Seed to all Darkness; These are Mirrors of the Soul; Reflections of the Mind--Choose Well

corvetteguy78

got approved......going to agent today and putting in offer...fingers crossed

Jeef

It is a pain for mortgages right now, they are looking at everything. Also, most mortgage brokers seem to be clueless. I talked to 3 of them and I got 3 different opinions of what I can afford.

corvetteguy78

yes they are looking at everything.....basically i was told that when we get our wedding money checks, we have to deposit them into a different account so it doesn't show up in the account we are using for the downpayment of the house. i had to send them proof of a lot things. Or else we are going to have to get a copy of each check we deposit and show it as proof of where it came from.

corvetteguy78

uhggggg.....went to make an offer yesterday....found out there was going to be another offer. We put in our best offer, guess we will have to wait and see.

corvetteguy78

Youuu boughhtttt it

B

nice. now sign your life away

corvetteguy78

haha, nah we'll be fine..im excited, inspection next week....closing Nov 16th.....freaking excited as hell... already have renters for her place lined up(not signed yet just in case) .

B

What town did you settle on?

corvetteguy78

meriden, almost near wallingford

93 Stephen Dr Meriden CT - Home For Sale and Real Estate Listing - MLS #N328880 - Realtor.com®

Jeef

Congrats.

B

very nice place. enjoy!

corvetteguy78

yeah...they dumped over 40k in the kitchen, not even sure how much on the sun room but it was built in 2010. They are leaving us that sun room set and a couple couches but not exactly sure which ones.