Posted on: 02nd Jan, 2011 01:16 am
due to the economy i lost my job back in early 2009 right in the middle of refinancing my house. since the refinance fell through i immediately moved out and started renting it out for a small loss to keep from going broke.
i ended up moving overseas to find work while i wait out the recession with the hopes of eventually moving back home to the u.s.
i am planning on how to move back to the u.s. once i can secure work. my overall plan is to keep my house as a rental and eventually buy a new house.
i am just trying to see if it makes more sense to first move back into my existing house, refinance, and then move to a new house in a year. this way my monthly mortgage payment goes down and i no longer take a loss when i rent it out again.
or is it better to just keep it as a rental, take a loss and buy a new house?
i was thinking of taking some savings from working overseas to pay down the mortgage and refinance to a 15yr loan(i still have 24yrs on existing loan). the plan is to eliminate mortgage insurance and drop the payment down just enough so i no longer take a loss. i'll live in the house for a year before i can legally rent it out again. during that time i will add to my existing savings for a down payment on a bigger house.
my finances are about to change with the birth of my first child this month and i am trying to plan ahead. if i refinance to a 15yr loan then 15 yrs from now the mortgage will be paid off and the majority of the rent would be extra income which would definitely help towards my son's college education.
just looking for any advice on my plan or if there is a better option.
thanks,
steve
i ended up moving overseas to find work while i wait out the recession with the hopes of eventually moving back home to the u.s.
i am planning on how to move back to the u.s. once i can secure work. my overall plan is to keep my house as a rental and eventually buy a new house.
i am just trying to see if it makes more sense to first move back into my existing house, refinance, and then move to a new house in a year. this way my monthly mortgage payment goes down and i no longer take a loss when i rent it out again.
or is it better to just keep it as a rental, take a loss and buy a new house?
i was thinking of taking some savings from working overseas to pay down the mortgage and refinance to a 15yr loan(i still have 24yrs on existing loan). the plan is to eliminate mortgage insurance and drop the payment down just enough so i no longer take a loss. i'll live in the house for a year before i can legally rent it out again. during that time i will add to my existing savings for a down payment on a bigger house.
my finances are about to change with the birth of my first child this month and i am trying to plan ahead. if i refinance to a 15yr loan then 15 yrs from now the mortgage will be paid off and the majority of the rent would be extra income which would definitely help towards my son's college education.
just looking for any advice on my plan or if there is a better option.
thanks,
steve
Welcome SteveR,
If you already have a mortgage on a property, the lenders will not be ready to give you a new mortgage to buy another home unless you pay off the existing loan. Thus, I don't think you'll be able to qualify for another loan immediately when you come back to US.
If you already have a mortgage on a property, the lenders will not be ready to give you a new mortgage to buy another home unless you pay off the existing loan. Thus, I don't think you'll be able to qualify for another loan immediately when you come back to US.
So getting a new house within 6 months of returning to the U.S. is probably out of the question?
But would it be possible to buy a new house in summer/fall of 2012 without selling my existing house or paying off the mortgage?
I know a lot of people that turned their first house into a rental when they bought their 2nd house but that was all before the housing crash.
I would prefer to upgrade to a new house while the market is down but I also do not want to be forced to sell my existing house in this market to do so.
Steve
But would it be possible to buy a new house in summer/fall of 2012 without selling my existing house or paying off the mortgage?
I know a lot of people that turned their first house into a rental when they bought their 2nd house but that was all before the housing crash.
I would prefer to upgrade to a new house while the market is down but I also do not want to be forced to sell my existing house in this market to do so.
Steve
Hi SteveR!
Welcome to forums!
It will be difficult for you to qualify for another mortgage if you already have an existing mortgage in your name keeping in mind the present real estate market situation.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
It will be difficult for you to qualify for another mortgage if you already have an existing mortgage in your name keeping in mind the present real estate market situation.
Feel free to ask if you've further queries.
Sussane
The guidelines today require there be 30% (25% for FHA) equity in the home you are vacating in order to use the rental income from that home in the qualification for the next home and mortgage.
A lot depends on what will be your income for the new job in the U.S.. If high enough income so you do not need rental income and can carry /qulaify for all mortgages based on salary, so be it.
It would seem to me to be a better game plan to move into current rental, refinance it at 30 year fixed so payment is lower to qualify for next mortgage. If 15 fixed would have been positive income for you, 30 fixed should be better to help qualify for the next mortgage.
A lot depends on what will be your income for the new job in the U.S.. If high enough income so you do not need rental income and can carry /qulaify for all mortgages based on salary, so be it.
It would seem to me to be a better game plan to move into current rental, refinance it at 30 year fixed so payment is lower to qualify for next mortgage. If 15 fixed would have been positive income for you, 30 fixed should be better to help qualify for the next mortgage.
