Originally posted by @Don Spafford:
@Dallin Watson Congrats on deciding to house hack. Depending on your lender, when you find a specific property they will want to see the rents first which they can use to approve you for a higher amount. I don't know your current income level but I would assume you would not be approved for more than $200k if you were to buy a house just to live in yourself. But if you buy a 4 plex they should be able to include I think 75% of the expected rent to increase your income which would allow for a higher loan amount. But you need to also be sure to work with a lender that understands rentals and will include the income for your benefit. I buy multi family only and have not had any problems with tenants. I also do a thorough job to screen potential renters to help avoid issues. If you haven't yet, I would suggest reading the "Book on Managing Rental Properties" you can buy here on BP. It will be very helpful.
For my pre-approval I have been working with ICCU. I have been working with one of the regular mortgage loan officer in the branches but I know they have real estate loan specialists so I am also working on getting in touch with one to see what things I could do to make my pre-approval to be accepted. I started the pre-approval process before I knew exactly what I wanted to invest in so I have been pre-approved for a 25% down on $175,000 investment property. Since then I have decided to house hack and live in a duplex and rent out the other apartment. I have been reworking the loan with them and currently trying to get pre-approval for a $200,000 primary residence loan that I will spend on a duplex. When I meet with the real estate loan expert I will ask about being able to use a quadplex’s rent to help me get a higher approval on the loan amount. I have only been looking at duplexes mostly because there are still a few that come onto the market that are in my basic pre-approval range. I will have to tell my agent to start looking for triplexes and quadplexes as well. I thought I had read just about all Brandon Turner’s books but I somehow missed his one about managing rental properties. I have looked it up and will be buying it shortly. This stuff gets a lot more exciting the deeper you get yourself into it!
