Can I carry two mortgage loans? (real estate, leasing, mortgage broker)

[emirate25]

I bought a house two years ago and I am planning on leasing it out at the end of this year. Since the rates are pretty low right now, I want to get into another place but I am not sure if the bank will allow it.

This is all new to me, so I was wondering if a bank will allow me to get a second mortgage as long as I have a year contract with a tenant on my first house?

[HoustonRonnie]

Yes. Why do you ask? I've owned three mortgaged rental properties with one-year leases and a mortgage on my primary residence.

[emirate25]

Thanks Ronnie for quick response. Like I said, I am new to this and I am planning on investing on more real estate.

[chris_ut]

Your debt to income ratio needs to show you can support both mortgage payments and not go over the cap for the type of loans you have (high would be like 48% - ie for every 1k you make you can not have more than $480 debt servicing including car payments, credit card min payment and the mortgages). You should discuss your options with a mortgage broker before you proceed on any transactions as the rules have gotten way, way stricter since the financial crisis and many things they used to be able to consider they no longer can.

[linicx]

To add to your post, chris_ut, many banks want 15% down. Banking rules have been tightened down to prevent another near crash, and banks are required to have more liquid assets on hand, I think. Also, a lot of the big banks just aren't lending even with 800 FICO scores and large down payments. .

Originally Posted by chris_ut

Your debt to income ratio needs to show you can support both mortgage payments and not go over the cap for the type of loans you have (high would be like 48% - ie for every 1k you make you can not have more than $480 debt servicing including car payments, credit card min payment and the mortgages). You should discuss your options with a mortgage broker before you proceed on any transactions as the rules have gotten way, way stricter since the financial crisis and many things they used to be able to consider they no longer can.

[fordlover]

Originally Posted by emirate25

I bought a house two years ago and I am planning on leasing it out at the end of this year. Since the rates are pretty low right now, I want to get into another place but I am not sure if the bank will allow it.

This is all new to me, so I was wondering if a bank will allow me to get a second mortgage as long as I have a year contract with a tenant on my first house?

We were able to have two mortgages at the same time, and we weren't renting either of them out. But we didn't have any other debt.

[emirate25]

Now, am I able to get a second mortgage at a low interest rate if I have good credit or will the bank as for a huge downpayment, with a higher interest rate?

[chris_ut]

Banks usually require 25% down payment for an investment property or second home. The low down payments on first homes are subsidized by the govt. to encourage home ownership.

[piyf]

Go for broke and get 3 mortgages. Lots a variables here bra.

[Houston_2010]

Originally Posted by emirate25

I bought a house two years ago and I am planning on leasing it out at the end of this year. Since the rates are pretty low right now, I want to get into another place but I am not sure if the bank will allow it.

This is all new to me, so I was wondering if a bank will allow me to get a second mortgage as long as I have a year contract with a tenant on my first house?

We currently have 2 mortgages, I'm paying both (other house is not occupied). It's very important that you have a good source of assets - Savings account, investments, etc that you can prove you have the cash. Excellent credit is very important as well.