When purchasing a new home many borrowers are inclined to keep their current residence as a rental or investment property. There are many things to consider with this approach. It’s important to consider the laws regulating property management. It may be beneficial to consider a property management company. Ask yourself if you are able to treat your home as a business.
Typically, to use the rental income for qualifying purposes you must have at least 75% Loan to Value (LTV) for FHA or 70% LTV for conventional loans in the new rental property as evidenced by an appraisal no older than 6 months and many times you must have six months house payment in savings.
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