When property managers want almost as much as Fannie Mae

Question

If the prop. Manager wants nearly as much as FHA what would u do?To buy and stay with the relative or waste over a thousand and go rent?

Timeline Dec. 2018

Literally could not take the verbal abuse and harrasement from my supervisor. Left job of 6 years

February

Started new job 6$ more per hr. New Holland, PA. Motel living until hire date.

September 2019

Full time hire +2$more pH. need to find a permanent residence.

Now we're into October  and the only rental company who has approved us given our criteria and two dogs wants a little over 3000$.  That's over half way to our 3%>

Tyler Gibson · Answer

@Jeremy Williams while your income matters what matters almost as much is how long you have been employed at the same place. Lenders want to see that you have been in the same job for 2 years as much as they want to see that you make enough to pay the loan. I am not certain what the exact criteria is as I am not a mortgage broker but I remember that being an issue for me 10 years ago when I first wanted to buy a place. So talk to a lender and find out if you even qualify for FHA then figure out the down payment.

Tyler Gibson · Answer

@Jeremy Williams If you can find a way to hold off on renting and buy with FHA then I would definitely got that route. The question I have is if you have had changes in employment recently it might hamper your ability to get approved for a loan. Have to talked with a lender about your credit worthiness? If you have family that will take you in for a specified period of time so that you can position yourself to buy then go that route but figure out if you can get a FHA loan first or at least know what you will need to do to position yourself to purchase in a year or 2. Stable employment history can and will impact a banks willingness to loan to you.

Tyler Gibson · Answer

@Jeremy Williams I don't think so because I think FHA is for people that have not owned real estate in the last 7 years. If the deed is in your name then that would make you an owner. Talk to a lender or research FHA requirements.

Tyler Gibson · Answer

@Jeremy Williams We all started in the same place knowing nothing so not to fret. I'm not sure what you are referencing but I would be willing to bet that all the people on the podcast used FHA for the first property then went conventional for the second. It may be possible to get 2 FHA loans but one would be for you the other for your significant other. That being said it would be like each of you are buying separate from each other. Meaning the neither one of you uses the others credit or name when buying. Some of the podcast people use VA loans but those are for military veterans and even then they are only allowed one at a time. So they might use it more than once but they would have refinanced the first one into conventional before using it again. If you are a veteran then look into that but I have little info on that since I am not a veteran. It is a bit confusing but that is why you need to contact a lender sit down face to face and figure out where you are and where you need to be to be able to qualify. Walk into your bank and ask to talk to a banker. Tell them what you are wanting to do and they will either help you or refer you to a mortgage broker that they work with .They will sit down ask you all the questions to determine if you qualify. If you do great! then it is just a matter of figuring out how much you can afford and how much cash you need to save to be positioned to make offers and close. If you aren't qualified then the broker should be able to give you an idea of what you need to work on ie. credit score, DTI (debt to income ratio), employment stability etc. Save yourself some frustration of trying to figure it all out on your own and go find a professional that can help you. I would not expect anyone to charge you they make their money when you use them to get a loan so it is in their best interest to help you figure it out. Good luck!

Caleb Heimsoth · Answer

@Jeremy Williams sounds right except for last month rent deposit.  That may be standard in your area or you have have less than ideal credit or rental history and that’s why they ask for that.

Pets are expensive, that’s why I don’t have them while I rent.  Just money out the door.

Irina Belkofer · Answer

If you’re not approved even for FHA, you’re better off renting rather than buy with HML.

Most of the houses I bought were financed with FHA loan. 3.5% down, 6% sellers help at closing costs and different community programs help you with these 3.5%. If you don’t have your own skin in the game - you’ll lose the house.

After foreclosure you won’t buy for 7-8 years and get to rent.

Landlords protect themselves against unstable people: credit, income, background etc.

Lenders won’t care if you were underpaid or not: they will take your average income for the last two years and qualify how much of a house you can buy.

When you’re a landlord yourself, you’ll understand requirements. People invested huge money and they don’t want any flakes as Tenants. Since you’ve got last month Rent as a requirement, something is wrong with your qualification.

It’s much better to think how to improve your financial resume to get FHA or nice house to rent.

BTW, Rent is more expensive to get into than mortgage because you’re paying for freedom to move if you don’t like neighbor, house or location. Once you bought it - you’re stuck with that and you start loosing money as soon as you decide to sell sooner than 5-7 years from moment of buying....with FHA - 10-12 years.

Jeremy Williams · Answer

@Scott Mac

It's funny I've been avoiding applying to these larger complexes with things like dog parks and gyms because I thought they might be even harder to get into. But I will definitely look into it as well as speak to a mortgage broker.

Ola Dantis · Answer

@Jeremy Williams Hey Jeremy,

Looking at the breakdown it looks about right but with the exception of the last month's rent.

If you think your job is permanent you might want to consider buying a duplex via FHA, so that way you have a tenant paying part of the mortgage with you. Also, you become a homeowner, meaning you can make your own pet rules!

Basically, NO RULES!

Scott Mac · Answer

Hi Jeremy,

With 2 dogs that might be an issue with some places.

You might want to try looking at BIG Apartment Complexes.

Many areas have small booklets of area apartment complex rentals in the local grocery store entrance.Look for ones with a dedicated Dog run/exercise area (we love dogs in the advertisement).

Then narrow it down to ones offering X free months rent on move in. Because that means they might be a little more flexible on move in costs, (and possibly credit rating).

You can get them with a pool and hot tub if that's your thing, and many have a workout gym too as well as professional management.

I will give you a heads up though, look and see who your neighbors are in the complex before you rent. Some can be tough places--but if you're a tough guy yourself--maybe that's where you want to be.

Also every place will have different criteria and want different amounts for move in--so if one isn't in your budget--keep trying.

If you do this you will have to pay an application fee worth a couple of McDonalds meals to apply to live there (credit check, background check, etc..), so it's best to discuss your situation with the person showing you the units before paying the fee. This can be done on the phone before you go.

Good Luck!

Jeremy Williams · Answer

@Tyler Gibson

I feel like I'm not bringing much know how to this conversation. That being said there has to be a way. I remember all these house hacking guests on the podcast didn't have conventionals that had a 1 yr min. Residency rqrmnt.. I thought they all used FHA or usda or the like, for the second BRRRR home.

When property managers want almost as much as Fannie Mae

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