Buying investment property, is it harder?

**gregory** · 04-30-2008, 07:58 AM

Hi,

I was considering buying a house for investment. This would be my first home but due to work location and other factors I would not be able to move to this house. I wanted to take advantage of the foreclosures and buy at a low price. I am currently renting a house but the rent is really low. I really could not afford anything in the area where I currently live. The prices here are no less than $450,000 and the price of the house I want to buy is $150,000. Big difference!. Not long ago my family and I were planing to relocate in order to afford a home and we got preaproved through my wifes with an FHA since she is a school teacher, but plans changed and we would not be able to move at this time. We have been told to go ahead and buy a house (lying) about the fact that we will not live in it. This sounds like trouble. I really want to do things right. What would be different in buying to rent? how much different would the interest be? Will my wife be able to qualify for an FHA loan under this conditions? Is there a minimum down payment required?.

Regards,
Greg

**mbippus** · 04-30-2008, 12:13 PM

Don't lie thats fraud. The rate for nonowner occupied is normally about 1%-1.5% more and you have to be able to show you can afford it. A mortgage broker is who you should talk to. One who isn't ok with lying on the application.

**portland real estate** · 04-30-2008, 03:59 PM

There are definitely loan products designed for investors. In order to find out specifically what you qualify for, you will need to talk to a mortgage broker and explain your interest and situation.

If you are buying an investment property then a couple of things you will want to keep in mind. For example, if you plan on doing the management yourself, as most first time investors do, then how far away is it from where you live? When things come up it's good to stay within a reasonable driving distance from where you live.

Another key thing is to find out what the mortgage payment will be, plus the property taxes, versus how much can you rent it for? This will give you an idea of whether your monthly cashflow will be net positive or negative.

Other things are the condition of the home, how old is it, how long do you plan on keeping it, is the market in that area appreciating etc...

**jron** · 05-01-2008, 09:14 PM

I think with your condition, lying isn't a very smart thing to do, I think that you should be aware of the market's structure. Although I personally think that you can just rely to some experts to those work for you and coordinate with them if you have further inquiries or questions