The Background

After having our first child, we decided to stop renting an apartment in the city and buy a house in the suburbs. The home buying process went fairly smoothly, until near the end of escrow when it came time to sign the loan docs. We were caught off guard by a clause we hadn't seen before: we'd have to move in within 60 days of close. We talked to the bank about this and explained why we couldn't move in right away. We got written confirmation that they understood that we 1) wouldn't be able to move in right away, 2) that we would rent it out in the meantime, and 3) that we would move in as soon as we can.

We rented the house out and moved in with my parents so that they could help watch my son until he's ready for daycare. (At which point we would move into our house.) And so, we became accidental landlords and I started reading up about these things and found BiggerPockets.

The Goal

We'd like to buy a smaller second home in the area. The goal is to buy a small condo for my wife and I to live in far in the future after we retire, and have it paid off by renters in the meantime. Ideally, we'd be able to buy this with a secondary home loan, since it'll have a lower interest rate than an investment property loan. (Which will make finding a place that cashflows slightly easier as well.)

Moreover, in an ideal situation, we'd like to buy the second home in the next year or so, while we're still living with my parents.

  1. Can we buy a second house with a secondary home loan before we move into our primary house? (We'd like to keep things above board, so if we need to wait until we move into our primary house, that's fine.)
  2. Can a second home purchased with a secondary home loan be in the same city/area as our primary home, or must it be located somewhere else? (Like a vacation home.)
  3. Can you rent a house purchased under a secondary home loan without living in it first? (Ideally, we'd move in decades later during retirement.)
  4. If we can rent it out, when applying for a secondary home loan, will the lender take into account potential rental income when qualifying the loan amount?