mtnstyne
New Poster
Cash: $ 0.20
Posts: 2
Joined: 30 Apr 2004
Location: Alabama
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Hello, I love these helpful forums and appreciate the information provided by you who take the time. Here is my situation.
I own a house valued at approximately $95,000 and owe about $75,000 on the mortgage. I am moving in about 45 days and have found another house to purchase at 146,500. I am applying for an FHA loan to reduce the upfront money at closing. I also have an equity line of credit on the first home with a zero balance but opened it to help with the closing costs for the second house.
I am going to rent out the house I currently own for $700/mo and the payment is $465/mo. I will have a gross monthly income of $4449 once I move and my only monthly debts are $427 (car) and $90 (credit card). I am married with 3 kids and she doesn't work. My credit scores are all in the 700-850 range.
Here comes the question. Is the mortgage company going to finance me for the new house payment that is estimated to be $1165/mo with my current debts and income?
How does owning one property affect applying for a loan for a second property?
Thanks in advance to anyone who can help me out.
Mtnstyne
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Fri Apr 30, 2004 2:44 am |
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Andrew
Admin
Cash: $ 467.10
Posts: 1717
Joined: 02 Nov 2003
Location: Texas
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I put in some of your numbers, plus some guesses about other figures into this calculator which tells you how much of a mortgage payment you can afford. Obviously this doesn't answer the full question, but it seems that you are in good shape as far as the formulas go. The rest of the question being, will the additional liabilty of your current mortgage in the case that you were not able to generate the positive cash flow from renting it. Try using the calculator to enter your worst case numbers (with no rental income) and see if you squeak through. Maybe we can get an expert answer to this in a few days.
How much can you afford?
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Sun May 02, 2004 4:33 am |
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