RUMOR: Buying another house while you currently own one…

[HLS]

Heard a rumor today from a reliable source…

If you want to buy another property,

The current FNMA guideline is that if you do not have at least 30% equity in your current primary home, and want to buy another house, you must qualify without getting credit for any rental income.
i.e. (2) mortgage payments, property taxes, insurance & HOA’s…
If you have 30%+ equity, they will allow 75% of rental income to be use as additional income against the expenses…

RUMOR IS that in the very near future, regardless of equity, they will not allow any rental income to be used. You will need to qualify for all carrying costs on 2 properties.

This will affect anyone who wants to move up OR wants to move down….Just a rumor at the moment…

Most people don’t qualify for one mortgage today, they certainly aren’t going to qualify for two.

Add this to the extra hit of .75% to a condo purchase with less than 25% down, and you can figure out where this is going.

Also, it has now become more expensive to take cash out of a refi for most borrowers. Millions have trapped equity that they cannot get to or it will be costly if they do…

HLS

[AK]

Too bad … there are some tempting deals out there, but now I may never get to be an evil landlord … I guess I’ll have to pack away my top hat and handlebar mustache.

[AK]

Too bad … there are some tempting deals out there, but now I may never get to be an evil landlord … I guess I’ll have to pack away my top hat and handlebar mustache.

[AK]

Too bad … there are some tempting deals out there, but now I may never get to be an evil landlord … I guess I’ll have to pack away my top hat and handlebar mustache.

[AK]

Too bad … there are some tempting deals out there, but now I may never get to be an evil landlord … I guess I’ll have to pack away my top hat and handlebar mustache.

[AK]

Too bad … there are some tempting deals out there, but now I may never get to be an evil landlord … I guess I’ll have to pack away my top hat and handlebar mustache.

[gn]

HLS,

Let’s suppose that this is true. Did you ask your friend/source on the rationale behind this change ?

It seems a bit draconian to totally disregard rental income. If this is true, it will hurt FNMA because it makes moving up very hard for buyers who have plenty of equity (more than 30%) to move up.

[gn]

HLS,

Let’s suppose that this is true. Did you ask your friend/source on the rationale behind this change ?

It seems a bit draconian to totally disregard rental income. If this is true, it will hurt FNMA because it makes moving up very hard for buyers who have plenty of equity (more than 30%) to move up.

[gn]

HLS,

Let’s suppose that this is true. Did you ask your friend/source on the rationale behind this change ?

It seems a bit draconian to totally disregard rental income. If this is true, it will hurt FNMA because it makes moving up very hard for buyers who have plenty of equity (more than 30%) to move up.

[gn]

HLS,

Let’s suppose that this is true. Did you ask your friend/source on the rationale behind this change ?

It seems a bit draconian to totally disregard rental income. If this is true, it will hurt FNMA because it makes moving up very hard for buyers who have plenty of equity (more than 30%) to move up.

[gn]

HLS,

Let’s suppose that this is true. Did you ask your friend/source on the rationale behind this change ?

It seems a bit draconian to totally disregard rental income. If this is true, it will hurt FNMA because it makes moving up very hard for buyers who have plenty of equity (more than 30%) to move up.

[Daniel]

HLS, your post isn’t primarily about investment properties, but still… I wanted to get this off my chest for a long time, and you provided the opportunity:

I’ve never understood why Fannie and Freddie were allowed to deal with non-owner occupied mortgages in the first place. They’re taxpayer sponsored entities (more like taxpayer owned, recently) supposed to “help foster homeownership”, right? How exactly is giving a mortgage to a landlord helping homeownership? Could someone explain that to me, please?

Now, don’t get me wrong, a landlord should be able to get a mortgage, of course. There is a private market for mortgages, isn’t there? I just can’t see what interest, as a taxpayer, I would have in “sponsoring” such an enterprise. Any way I wrap my mind around this, it doesn’t make any sense.

The best I can do is “OK, the landlord is esentially a small business owner, and perhaps he should be able to get a better rate loan through a Small Business Administration (SBA) program”. But Fannie and Freddie??? What in the world Fannie and Freddie have to do with it?

[Daniel]

HLS, your post isn’t primarily about investment properties, but still… I wanted to get this off my chest for a long time, and you provided the opportunity:

I’ve never understood why Fannie and Freddie were allowed to deal with non-owner occupied mortgages in the first place. They’re taxpayer sponsored entities (more like taxpayer owned, recently) supposed to “help foster homeownership”, right? How exactly is giving a mortgage to a landlord helping homeownership? Could someone explain that to me, please?

Now, don’t get me wrong, a landlord should be able to get a mortgage, of course. There is a private market for mortgages, isn’t there? I just can’t see what interest, as a taxpayer, I would have in “sponsoring” such an enterprise. Any way I wrap my mind around this, it doesn’t make any sense.

The best I can do is “OK, the landlord is esentially a small business owner, and perhaps he should be able to get a better rate loan through a Small Business Administration (SBA) program”. But Fannie and Freddie??? What in the world Fannie and Freddie have to do with it?

[Daniel]

HLS, your post isn’t primarily about investment properties, but still… I wanted to get this off my chest for a long time, and you provided the opportunity:

I’ve never understood why Fannie and Freddie were allowed to deal with non-owner occupied mortgages in the first place. They’re taxpayer sponsored entities (more like taxpayer owned, recently) supposed to “help foster homeownership”, right? How exactly is giving a mortgage to a landlord helping homeownership? Could someone explain that to me, please?

Now, don’t get me wrong, a landlord should be able to get a mortgage, of course. There is a private market for mortgages, isn’t there? I just can’t see what interest, as a taxpayer, I would have in “sponsoring” such an enterprise. Any way I wrap my mind around this, it doesn’t make any sense.

The best I can do is “OK, the landlord is esentially a small business owner, and perhaps he should be able to get a better rate loan through a Small Business Administration (SBA) program”. But Fannie and Freddie??? What in the world Fannie and Freddie have to do with it?

[Daniel]

HLS, your post isn’t primarily about investment properties, but still… I wanted to get this off my chest for a long time, and you provided the opportunity:

I’ve never understood why Fannie and Freddie were allowed to deal with non-owner occupied mortgages in the first place. They’re taxpayer sponsored entities (more like taxpayer owned, recently) supposed to “help foster homeownership”, right? How exactly is giving a mortgage to a landlord helping homeownership? Could someone explain that to me, please?

Now, don’t get me wrong, a landlord should be able to get a mortgage, of course. There is a private market for mortgages, isn’t there? I just can’t see what interest, as a taxpayer, I would have in “sponsoring” such an enterprise. Any way I wrap my mind around this, it doesn’t make any sense.

The best I can do is “OK, the landlord is esentially a small business owner, and perhaps he should be able to get a better rate loan through a Small Business Administration (SBA) program”. But Fannie and Freddie??? What in the world Fannie and Freddie have to do with it?

[Author]

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