Co-Signing for My First Investment Property
I'm 22 and am buying my first investment property and plan on house hacking it. I work as an independent contractor as a real estate agent and welder. This will be my first house and I'm buying it with an FHA loan. I am locked in for a 5.75% interest rate (after a 1% rate buydown) and my bank at first said I only had to put 10% down. Now the bank is saying that I will have to go through manual underwriting and put about 20% down, because of how I did my write-offs for my 1099s. I had an increase in welding income but more than a 20% decrease in real estate income. I am only $1000 short in real estate income (that's the income the are going off of for the loan). At that higher down payment I'm only able to afford it if I liquidate most of my stock portfolio, and then I won't have any cash left over for the repairs that I need to do. I do have the option of co-signing which would also allow me to only put down only 5%. I am trying to avoid co-signing because so I'm not relying on my parents and I'm not sure when I will be able to refinance to get their name off of it. Is there a way that I can adjust my income to get that extra $1000, or do I need to suck up my pride and co-sign?
Have you checked with other lenders?
What about down payment assistance in New York? Would one of their programs help?
Hey Ethan, my wife and I also used a co-signer to buy our first duplex because I am a 1099 worker. I think I can provide a couple possible solutions for you.
Hamp has a great Idea of shopping around for different lenders!
I also know a really good CPA can go back and revise your previous years tax return so that you can be exactly where you need to be in order to meet the requirements for what the lender is asking for.
You could also partner w/ your parents and offer them some cash flow or equity when you refinance, that way you aren't totally relying on them!
