1 Hour Away from Indy - Lending options?

[Ryan Ness]

I am currently located in Lafayette, Indiana. I have been living in a duplex househack that I purchased in 2021. I would always prefer to use as low a down payment as possible, but I understand that being located 1 hour from Indianapolis may present some challenges.

I currently have a W2 income in Lafayette and am a licensed realtor in Indiana as well. I have not been as focused on the real estate sales and have really just held onto my license for the time being.

Are there any lenders that would be a good fit for this scenario? I do not see myself doing 20% down on any property greater than $150,000 to ensure I still have reserves.

I have already linked up with some Realtors based in Indiana and have property searches going, but I want to be sure I am set to submit offers when the opportunity arises. I have been working on sourcing deals in Lafayette as well, but the market is pretty thin here compared to the options even just on the MLS in Indy. I have 2 options on the MLS here in Lafayette that I know do not work, but there are 11 in Indy in my list of options at the moment just as an example.

[Joseph Chiofalo]

Hi Ryan, 

Are you looking to purchase this as a primary home? 

[Andrew Postell]

@Ryan Ness house hacking means buying your own primary home.  So, buying your own primary home should not be an issue at all - even if it's outside of a city.  Have lenders told you that something is up?  Feel free to reach out directly if you want to talk anything through.  Thanks!

[Ryan Ness]

Quote from @Andrew Postell:

@Ryan Ness house hacking means buying your own primary home.  So, buying your own primary home should not be an issue at all - even if it's outside of a city.  Have lenders told you that something is up?  Feel free to reach out directly if you want to talk anything through.  Thanks!

 I figured it wouldn't be much of an issue. I had one lender who was taking issue with anything that was greater than 1 hour away as they were concerned with my commute to my W2. 

[Ryan Ness]

Quote from @Joseph Chiofalo:

Hi Ryan, 

Are you looking to purchase this as a primary home? 

 Yes, it would be my primary residence. I have been trying to also take advantage of the Fannie Mae 5% down-payment option if possible too.

[Derek Brickley]

Hey Ryan! If you live in a duplex now and want to buy a single-family home then that is generally a good reason for the move. I'm assuming you used FHA on your duplex in 2021 so that 5% down conventional would probably be a good bet. Feel free to reach out though with any questions you might have.

[John Burke]

A 1 hour commute is not a problem but you may need to provide a letter of explanation. Occupancy fraud is the most common fraud committed in mortgage lending so underwriters look at things like distance from your job as a possible indicator. 

Did you claim the your rental income from your current duplex on your taxes? 

What type of property are you look for now, SFR or multi-unit?
I can lend in all 50 states and would be happy to help you figure out some options.

[Ryan Ness]

Quote from @John Burke:

A 1 hour commute is not a problem but you may need to provide a letter of explanation. Occupancy fraud is the most common fraud committed in mortgage lending so underwriters look at things like distance from your job as a possible indicator. 

Did you claim the your rental income from your current duplex on your taxes? 

What type of property are you look for now, SFR or multi-unit?
I can lend in all 50 states and would be happy to help you figure out some options.

As it has now been 2 years since the property has been rented, I do claim the income on my taxes. 

I will be interested in multi-family, LTR opportunities that I can househack. If the cash flow of this property could get me beyond what is needed for my cost of living, my current W2 may not be a requirement, and I could make use of my Realtor's license in Indianapolis instead. I know the W2 may be needed for the approval, but I didn't know if there are other options if I needed to step away from the W2.

[Kerry Noble Jr]

Hey @Staci Rogers is there anything you can do in this situation?

[Staci Rogers]

@Kerry Noble Jr Thanks for looping me in.

@Ryan Ness Interesting scenario, as I commute an hour every day for work also! I would be happy to connect and chat; however, any type of income producing properties would require 25% down. There are several areas in Indiana that are doing well with cash flow. Feel free to reach out if you want to chat. 

[John Burke]

Quote from @Ryan Ness:

Quote from @John Burke:

A 1 hour commute is not a problem but you may need to provide a letter of explanation. Occupancy fraud is the most common fraud committed in mortgage lending so underwriters look at things like distance from your job as a possible indicator. 

Did you claim the your rental income from your current duplex on your taxes? 

What type of property are you look for now, SFR or multi-unit?
I can lend in all 50 states and would be happy to help you figure out some options.

As it has now been 2 years since the property has been rented, I do claim the income on my taxes. 

I will be interested in multi-family, LTR opportunities that I can househack. If the cash flow of this property could get me beyond what is needed for my cost of living, my current W2 may not be a requirement, and I could make use of my Realtor's license in Indianapolis instead. I know the W2 may be needed for the approval, but I didn't know if there are other options if I needed to step away from the W2.

 IMHO in order to secure the best terms, you'll want to stick with W-2 for the purchase. Once you've had a chance to see how the property performs, you can revisit the idea of giving up your W-2 job.