I live in California, but the housing prices and new tax laws are prompting me to invest out-of-state. As a first time buyer with a modest income and very good credit score, I am considering an FHA loan.
I have spoken to two lenders in California, and they both advised me that an owner-occupied property would be my best approach based on my income. Ideally, I would love to buy an out of state investment property and continue living in California, but I am open to living out of state for a year or two to satisfy the FHA's required one-year occupancy rule. If I do live out of state, the lender wants to see that I have a job in the new state. This is my catch 22.
Considering my situation, can anyone advise me on how to successfully find a lender for a property out of state, either FHA or other.
If you want to continue to live in CA but invest out of state your best bet is a typical residential loan, which will be 15-25 percent down and 4.5-5ish interest rate, amortized over 30 years.
This is what I’ve done and so far it’s worked out well. I don’t live in CA but I live in an expensive market (compared to the central part of the country) and my dollar goes further out of state.
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To add to what @Caleb Heimsoth said, I think finding a really boots-on-ground contact in the state you choose will be instrumental too. BP is a great place to find that person when you choose the market (or submarket) you wish to invest in.
Hope this helps. Good luck. Thanks! - Ola
@David Ruiz , I am in your currently standing in your shoes. Please update me with what you find. I am gathering as much information about this as well. If I hear anything from my end, I will update you!
@David Ruiz, right there with you on this one. I can't move out of state yet; job and girlfriend keeping me here. Which messes up my ability to use FHA too.
I did want to mention that one of the more recent podcasts had David Greene on it. He's published a book on long-distance investing. Here's the podcast link:
The book's on my reading list for 2018. I expect it would help both of us. Best of luck.
@chris williams , I have listened to the David Greene podcast. Inspiring, but still need to figure out the best lending approach for myself. Thanks for your reply, and good luck!
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