How many mortgages can I can I have?

3 Replies

I live in Sioux Falls, SD and am not sure how to find out how many mortgages I can have here in my name. I heard on on early podcast that it was 8, but then I also heard that it was ten. Does it vary by state?

 I have one mortgage on my duplex, and in 6 months plan on getting another for our single family home, then over the years getting another 5-20 rentals. Long term what should my plan be as far as how many mortgages I can carry before I have to start doing 100% down or contract for deed? 

Drew,  I have had as many as 27 mortgages at one time.  I could have continued having more if I choose.  Mortgage companies have certain guidelines that you must follow in order to qualify.  As you probably already know, you can only have one owner occupied at one given time.  All the rest are treated as investment properties.  Typically there is a 10% down payment requirement for the non-occupied properties you purchase.  However there are many ways to purchase homes at 100% financing even as an investment home.  You just have to do your homework and ask the right people how it is done.

I'm new to this site, but have been told we are not allowed to provide any of our contact information in here otherwise I could tell you over the phone as well as turn you onto properties that work for this type of purchase.

Good luck and hope that helped answer your question.

THANK YOU! That was very helpful.  I met with a mortgage broker a month ago and he told me that new laws make it so I have to have 25% down on an investment property. Since they are a broker and go through many banks I did not bother talking with any other bankers. 

 Since you mentioned ten percent down I am wondering if I should ask around more or if it is just a local thing.

Drew, going through a broker does have its benefits since they can shop different lenders for you.  That is what I did when I built up my investment properties.  The lenders have their own guidelines and restrictions so it is very important that the broker you go through has established great business relationships with these lenders he/she works with.  Having great relationships your broker is able to pull some strings and get things approved for you.

The bad thing about going through a broker is, they have to get paid as well since they are the middle man so to speak.  Therefore as I had found, higher closing cost and or yield spreads as well as higher interest rates play a roll.

If you are buying for a short term to flip the property the interest rate does not play as an important role provided there are not any prepayment penalties ( they usually are because that is how they make their money from you.) 

Putting down 25% is not something I would NOT get excited about doing as I can take that same 25% of a average sales price and buy 5-10 homes cash with no mortgage payment and get much higher returns.

We turn our investors onto a partnership and generate them anywhere from 18-24% return on their investment. 

With that being said, do your homework and get referrals from people you know and trust with a great track record.

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