First Rental / First post

[Thomas Eineke]

Hello, I've been putting offers in on for my first rental property (single family homes out of an HOA). Anyway.... I have enough put away to purchase a few properties for rentals and kick start everything with a faster scale and keeping reserves on hand. The problem however is that first year of rental history. I do not have one year of rental history and working with my lender who also has a large portfolio says my rate would be high without that first year of rental history.

First home will be with the VA loan so I have to homestead it and then after the first year I am refinancing then turn around and do it again for the 2nd home, but I wont have to wait another year because I will have the rental history at that time.

I was thinking of creating an LLC (which I will do in the future but not for my first property) and renting the house to the llc for the first year. This will be all done with no outside parties so VA will not question anything. Just trying to create a loophole or use an existing one.

Any insight into this idea or suggesting on alternative route... I am getting older so I need to not move at a rapid pace but for my goals toward retirement I need to act now.

Thank you for your time.

[Joseph Chiofalo]

Hi Thomas, 

What location would you be buying in when you use your VA eligibility?

[Thomas Eineke]

Joseph, The midwest.