All Forum Posts by: Ryan Culp

Good Morning,

I have a unique situation on my hands. I am going to be purchasing a home in Galveston Texas that I plan on renting out as much as it can be rented. But I also plan on going to the home when I am off work to enjoy it myself. Now my dilemma is how to go about financing it.

I am a merchant mariner so I am only home about 4 months a year right now. I do not currently own a home. So I am having a little trouble getting clarity as to how I should finance this home. Can you use an FHA loan and rent the home out as a vacation rental? Or would that be considered mortgage fraud? My situation is unique because I really am only home about 4 months a year. I am also considering an investment loan, but being only 24 I am not sure I will be able to get one. I have the money to put down and a great credit score, but do not have the credit history I think I will need. Not to mention with an investment loan I have read you can only spend 2 weeks at the home and when I am home I would like to spend a decent amount of time there.

Another note, I have my primary residence with my parents. I can leave it as it is if that is of any assistance.

Any suggestions of how to go about this would be greatly appreciated.

Respectfully,

Ryan

Good Morning Everyone,

A little background on myself. My name is Ryan, I am 24 years old and looking to start investing in real estate. I graduated from Massachusetts Maritime Academy in 2016 with a Bachelors Degree in Marine Transportation and a 3rd mates unlimited tonnage USCG license. I am currently employed with one of the largest shipping companies in the US. I was not the straight "A" student in school but I made the right connections and have landed a very good job where I make 6 figures at a young age. With my job I work on ships as an officer so I am out to sea about 8 months out of the year.

With that being said I am trying to invest my money in real estate. I have spent the last year reading as many books as I could, talking to as many successful investors as I could, studying different markets and trying to understand trends as best I could, as well as traveling around to different areas and looking at properties. After the last year I have narrowed my search down to the state of Texas. I plan to buy a vacation rental. I have been juggling the numbers and I believe there is some money to be made in areas such as Galveston. 

Now I am open to any and all advice but my main questions are as followed.

1. How should I go about financing a vacation rental? I do not own a home currently. Can I get a conventional loan, rent the property as a vacation rental, and use it as my main address? Or do I have to finance it as an investment property? I am unsure if I will be able to qualify for an investment loan. I have excellent credit that I have been building since I was 18 years old. But still that is not a lot of time to build credit history, I will have around 40K cash to put down with enough in reserve to survive for 10 months should I lose my job or something crazy happened.

2. I would like to be able to spend some time at this home. By that I mean maybe one month a year. I know with an investment loan you can only spend 2 weeks or a certain percentage of time at the home a year. How strict is that? I am just trying to figure out what is the best avenue to do this.

As I said I am new to this, you can not hurt my feelings. If you see a major red flag somewhere in my plan hit me in the face with it!! I am just trying to gather as much information as possible before I dive into this.