Can’t get investment loan without owning a house?
My wife and I rent in the LA area and entertained the idea of buying a house (laugh track ensues). We connected with an agent and are in the middle of a pre-approval process with a mortgage officer. Today, I let him know our goals are to invest in multifamily homes in the Midwest whatever and asked if getting pre-approved for a home for us would hurt our credit or chances to get pre-approved for rental properties.
So now he’s saying it won’t, but banks won’t approve us for an investment loan unless we already own a house. That sounds like a load of rubbish to me. Is he right? Owning a house in LA is immensely costly and I think we’d rather spend our downpayment cash on something that cash flows.
Tl;dr: loan officer handling our pre-approval application for a house in LA says we won’t get an investment loan until we buy our own house.