Buying a second house in Texas (PMI, loan, property tax, heloc)
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You don't need to put 20% down, but you might want to.
You'll have two mortgages.
You'll get part of the rent counted as income, but you also have to consider the other expenses such as property taxes, insurance, HOA if any, to count against the rental income.
You definitely don't need 20% down. You're not buying what is considered a "second home". You're buying a new primary residence as the first will turn into a rental. A "second home" is when you live at both residences throughout the year. That has different financing guidelines than primary residence.
Also, the rent you receive will not all count towards your debt ratios because they have to factor in vacancy and it hasn't been rented for at least 12 months to show consistent income. Either way, to qualify for the 2nd mortgage, your debt to income ratios have to be within their specific guidelines. Each loan program has different guidelines.
I haven't talked to a banker yet, I'm not totally serious just coming up with scenarios with my wife.
We own a house in Austin area. Worth about 200k, we owe 120k on it.
We pay no PMI, we are below 80 percent LTV.
Wife has a couple very good job opportunities in Dallas area or Houston area. Either area would double her salary, and be a good move for her.
I work IT so I can get a good job in either city.
Friend of mine told me that I need to put 20 percent down to qualify for a second home mortgage.
We plan on using our home in Austin as a rental property.
Say for example, we owe 120k on the house in Austin. That will fetch market value of $1500 per month in rent (EASY).
We want to buy a normal house in Dallas or Houston for right around $175k-$200k no more.
I know we could carry a 300k mortgage and would qualify for it, but how does the bank view two seperate mortgages?
Especially with a renter paying $1500+ per month.
You're buying a Primary Residence.
You will need Offer letter and first months' paystub for the new jobs, or a letter from your employer ok-ing you working remotely.
2nd homes - $15% Down. I'd do it as a Primary w/3% down Conv., and buy another investment property, provided my non-REO debt is minimized/mitigated. IMO.
I haven't talked to a banker yet, I'm not totally serious just coming up with scenarios with my wife.
We own a house in Austin area. Worth about 200k, we owe 120k on it.
We pay no PMI, we are below 80 percent LTV.
Wife has a couple very good job opportunities in Dallas area or Houston area. Either area would double her salary, and be a good move for her.
I work IT so I can get a good job in either city.
Friend of mine told me that I need to put 20 percent down to qualify for a second home mortgage.
We plan on using our home in Austin as a rental property.
Say for example, we owe 120k on the house in Austin. That will fetch market value of $1500 per month in rent (EASY).
We want to buy a normal house in Dallas or Houston for right around $175k-$200k no more.
I know we could carry a 300k mortgage and would qualify for it, but how does the bank view two seperate mortgages?
Especially with a renter paying $1500+ per month.
Obtain a $40k HELOC on your current home and use that as the down payment on the new one.
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