Buying after househack

5 Replies

Those of you that have house hacked a 2-4 unit for your first property, I'm curious as to what your second property was and how you acquired it? Also how long did it take to get the second property?

What is the intent of this second property? Strictly investment or another house hack?

For me, my first FHA-duplex-house-hack was a live-in-rehab. After many nights and weekends of sweat equity, I refinanced into a conventional loan 1.5 years after purchase. The house appraised with whopping 30% equity! (started with 3.5% down payment).

Then i began my search to repeat the process.

When my second FHA -duplex-house-hack was under contract, the underwriter put me through the wringer. I had to jump through hoops to prove that I had every intent to occupy this new property. Also had to fight with them over my Debt-to-income. They refused to accept my original duplex as positive cash flowing because the rental income was only enough to cover the mortgage payments. I could only prove income from one of the units since I was living in the other, they wouldn't accept the future promise of additional income once I moved out.

BUT eventually I prevailed, currently I'm in the process of stabilizing the new property.

Hope this helps

Cheers

 @Bill E. @Emilio Urias @Mary Ann

@John Alosio what kind of documentation do they ask for to prove income from currently owned property? Just signed contracts and  how long do these contracts have to extend? Say for example, you showed them signed contracts extending 6-months. Are lenders typically going to fight that?

Thanks in advance and congrats on the second property.

@Emilio Urias

I'm not sure the specific criteria for an underwriter. From what it understand, it can range bank to bank. I got the feeling that my underwriter was being a stickler. Maybe you'll get lucky with a more lenient one. But again, IDK exactly how it works. Perhaps someone with more knowledge can chime in....

I know that they looked at my Tax filing. My income from the previous property was basically -0- after I satisfied my monthly mortgage payment. The new property was fully rented, and still they refused to factor that into my DTI. I hope that your underwriter may be more willing to work with you.

Good luck!