Anyone bought a 2nd house recently?

angelabbf · April 2011

I'm wondering, realistically, what the chances are that we could buy a 2nd house and rent the one we're in now (we're technically upside down on it, so we don't have anything to work with on this one).... It seems like the market is so crazy and loans are challenging to get. Would it take a boat load of a down payment to get into a 2nd house?

Just curious if anyone's done it recently and what your experience was...

cheryl2006 · April 2011

I think tonic did sometime last year...

StefandTodd · April 2011

We did about 17 months ago. We qualified for FHA, had to put about 6.5% down (closing costs and DP inclusive). I think you'll want to hear from people who've done it even more recently than that though b/c I've heard they're getting a lot stricter b/c of the liklihood people will walk away from their first (upside down) home once they are into another house. It can't hurt to talk to a mortgage banker to just see what your options are though. GL!

kfishie · April 2011

StefandTodd:
We did about 17 months ago. We qualified for FHA, had to put about 6.5% down (closing costs and DP inclusive). I think you'll want to hear from people who've done it even more recently than that though b/c I've heard they're getting a lot stricter b/c of the liklihood people will walk away from their first (upside down) home once they are into another house. It can't hurt to talk to a mortgage banker to just see what your options are though. GL!

That is awesome! I hear now, at least for some areas, it is more like 20% DP not including closing costs.

tonic · April 2011

cheryl2006:
I think tonic did sometime last year...

Yup, I did. Send me an email or FB message if you want to chat about details.

kfishie · April 2011

I ditto Stef about talking to a mortgage banker.

PMed you the rest of my thoughts.

abvernon · April 2011

kfishie:
StefandTodd:
We did about 17 months ago. We qualified for FHA, had to put about 6.5% down (closing costs and DP inclusive). I think you'll want to hear from people who've done it even more recently than that though b/c I've heard they're getting a lot stricter b/c of the liklihood people will walk away from their first (upside down) home once they are into another house. It can't hurt to talk to a mortgage banker to just see what your options are though. GL!

That is awesome! I hear now, at least for some areas, it is more like 20% DP not including closing costs.

In this area (where we are looking at), it is the norm. The banks are still reluctant to loan a house with less. Even with excellent credit scores like ours.

StefandTodd · April 2011

kfishie:

StefandTodd:
We did about 17 months ago. We qualified for FHA, had to put about 6.5% down (closing costs and DP inclusive). I think you'll want to hear from people who've done it even more recently than that though b/c I've heard they're getting a lot stricter b/c of the liklihood people will walk away from their first (upside down) home once they are into another house. It can't hurt to talk to a mortgage banker to just see what your options are though. GL!

That is awesome! I hear now, at least for some areas, it is more like 20% DP not including closing costs.

FHA loans only require 3.5% DP, but there are financial downsides to them as well (mortgage insurance, for example).

My understanding is that FHA loans have gotten harder to get (and they were hard to get 17 months ago, but have gotten even harder), but if you qualify for them, you can still put as little as 3.5% down (at a minimum, of course).

StefandTodd · April 2011

abvernon:
kfishie:

StefandTodd:
We did about 17 months ago. We qualified for FHA, had to put about 6.5% down (closing costs and DP inclusive). I think you'll want to hear from people who've done it even more recently than that though b/c I've heard they're getting a lot stricter b/c of the liklihood people will walk away from their first (upside down) home once they are into another house. It can't hurt to talk to a mortgage banker to just see what your options are though. GL!

That is awesome! I hear now, at least for some areas, it is more like 20% DP not including closing costs.

In this area (where we are looking at), it is the norm. The banks are still reluctant to loan a house with less. Even with excellent credit scores like ours.

This may be the change with FHA in the last year and a half. Also, I think in many cases it's the actual sellers that don't want to accomodate an FHA buyer in this market. This is something we also ran into. Our home's seller didn't want to deal with an FHA loan b/c they have more requirements for the condition of the house, can take longer to go through, and can have a reputation for having less serious buyers. I truly credit our mortgage banker for his help. He called the seller's agent and gave him the hard sell about our financial situation (why we chose FHA - primarily b/c of our second home), his confidence in securing the loan quickly, etc. I think the sellers would have held out for a buyer with a traditional mortgage, rather than us with an FHA, if he hadn't called.

kfishie · April 2011

Thanks Stef. Now I am off to google FHA loans and the difference between them and bank loans....... Smile

angelabbf · April 2011

Thanks everyone!

Tonic - Emailed you

Kfishie - PM'd you back

Now off to go look what FHA loans are all about....

abvernon · April 2011

StefandTodd:
abvernon:
kfishie:

StefandTodd:
We did about 17 months ago. We qualified for FHA, had to put about 6.5% down (closing costs and DP inclusive). I think you'll want to hear from people who've done it even more recently than that though b/c I've heard they're getting a lot stricter b/c of the liklihood people will walk away from their first (upside down) home once they are into another house. It can't hurt to talk to a mortgage banker to just see what your options are though. GL!

That is awesome! I hear now, at least for some areas, it is more like 20% DP not including closing costs.

In this area (where we are looking at), it is the norm. The banks are still reluctant to loan a house with less. Even with excellent credit scores like ours.
This may be the change with FHA in the last year and a half. Also, I think in many cases it's the actual sellers that don't want to accomodate an FHA buyer in this market. This is something we also ran into. Our home's seller didn't want to deal with an FHA loan b/c they have more requirements for the condition of the house, can take longer to go through, and can have a reputation for having less serious buyers. I truly credit our mortgage banker for his help. He called the seller's agent and gave him the hard sell about our financial situation (why we chose FHA - primarily b/c of our second home), his confidence in securing the loan quickly, etc. I think the sellers would have held out for a buyer with a traditional mortgage, rather than us with an FHA, if he hadn't called.

hmmm...might have to look into this. Yup and FHA has such a strict requirement and all the houses we have looked at, we would have to do some upgrades before we close. We realized that we did not want to deal with this and also PMI (private mortgage insurance) so we are trying to achieve 20% DP. I am not sure how long it will take us but we are getting closer.

secretkeeper321 · April 2011

We are in the process of trying to buy our third. We looked into it all just in the past two months...I'd be happy to talk over pm or email.

angelabbf · April 2011

secretkeeper321:
We are in the process of trying to buy our third. We looked into it all just in the past two months...I'd be happy to talk over pm or email.

What's your email addy? I'll email ya.

secretkeeper321 · April 2011

Hey...sorry...didn't get on the boards over the weekend (sick kiddo will do that).

rynkramer at yahoo dot com

Anyone bought a 2nd house recently?

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