I am new to the rentaI game and need all the help I can get.I own one home that I live in. I want to buy a duplex for 100k with a FHA loan in my personal name for my first rental property. Is the possible? What about debt to income? I make about 90k a year. My credti scores are in the 680 range. Only thing that is on my credit now is my house note 1450mo truck note 375mo and student loan 100mo. my credit cards have less than 50$ balances on them. I want to want to work my way in to more over time. what is the best why to do this. I just started a LLC but from what I have read it is hard to get a low interest 30yr fixed loan in a LLC name. I have 20k to invest. Thanks in advance.
Residential Lender · Austin, TX · Member since 2011 · 17 posts · 5 votes
15y
Chad,
You can get an FHA loan for the rental property as long as your are willing to occupy one side of the duplex as your primary residence. Remember, FHA loans are only for owner occupants. You can then turn your existing home into a rental property.
Based on the information provided I doubt you would have much issue with qualifying should you want to proceed. Again, an FHA loan allows for the Seller of the duplex to contibute up to 6.00% towards your closing costs/prepaid expenses, so you can take that into consideration with the price your willing to pay (ie. higher price & less out of pocket for you).
If you were in TX I could help, but if not, talk to a local mortgage banker/broker and they can get you set up.
One more item, if your current residence is financed by FHA then you can't do this as your only allowed to have one FHA loan at a time with very few permitted exceptions, of which your situation does not fall under. You could refi an existing FHA into an conventional loan to make it happen if that is the case.