Does rental property hinder you from moving into a bigger house?

[Jackie Tang]

Hi BP members,

I am a newbie here but I have been listening to the BP podcasts for the past year. We are thinking to buy a long term rental property. We currently have a mortgage for our home and I am just wondering if we buy a rental property now with a conventional loan, will it be harder to obtain a bigger mortgage if we were to move into a bigger house down the road? 

Thanks,

Jackie

[Steve Smith]

Not necessarily, but depends on the lender. Most lenders will look at the investment house as an investment and it shouldn't affect a new loan, unless it's negative and not producing well. Also, a lot of lenders get turned off with investors once they get about 4 rental properties, then they get hard to deal with. There's an argument for seller financing and you don't have to deal with banks.