Finding the Right Lender for FTHB for Out of State Investments

[Holly Smith]

Hi BP team. I am looking to invest my hard earned pennies out of state in either SFH or Multi with goal of building sufficient cash flow to allow me to leave my current W2 job. I am a younger single gal, first time home buyer and first time investor and I could really use some guidance on my journey as I am quickly learning there are many speed bumps.

First Question: How do you choose the right lender without destroying credit buy having multiple credit inquiries?  

[Michael Glist]

So my question would be if you are going to live in the home initially and then turn it into a rental. 

If not and it is strictly an investment property you will want to talk to a normal (conventional) lender and make sure that you qualify. I say this because as a first time investor you would be required to not only afford the new mortgage but also your current rent/mortgage as well as any additional debts without using any rental income to qualify. A conventional lender will require you to have 2 year rental income history in order to qualify using rental income which make qualifying a little harder. 

If you do not qualify for a conventional loan you will want to start looking for a NON-QM or commercial lender as they will qualify you based on the property more so than you as an individual. 

I hope this helps.