Need Expert Opinions For Rental Positive Cash Flow

[Amir Saeed]

I am new to Real Estate Investment. I am looking at a possible deal. Purchase a property and use it for a rental (positive cash flow). I have a property in sight, and the numbers are working pretty good. The only issue is that I already own a house and to get the financing for the second is hard. From what I have seen so far there are three categories primary, second home( Far away, resort, beach....etc) or the last option which is investment.

I was looking to put around 5% down for the down payment but looks like I am leaning towards the third option which is investment which requires 20-25% down. Is there any way I could make my deal a second house and not go with investment option. I am sure its doable, but somehow I have to make the property appear not as an investment. Can anyone suggest any tips...Thanks

[Jon Holdman]

Let me go back to your basic question. You're wanting to buy a rental property using owner-occupied financing. Spin it however you want, what you want to do is wrong. You're claiming to occupy a house when, in fact, you have no such intention. To get this loan, you will have to SIGN statements saying you're going to live there.

Further, there are very few loan programs that even let you buy a primary residence with 5% down. AFAIK, FHA with 3.5% down is the only such program. I'm not aware of any way to buy a secondary residence with only 5% down.

A more realistic suggestion is some sort of owner financing. Find an owner that will sell to you and carry a note.