If you are moving to North Carolina, and you are going to rent your current home, there are a couple of things you should know about qualifying for an FHA Mortgage Loan for your new house. If you qualify for both payments – then it’s a pretty easy deal. If you need to count some of the income from your current residence it gets a little more tricky.
FHA Guidelines state that the rental income can not be counted, unless we can prove that you have at least a 25% equity stake in the home you are going to rent out. Too many people are buying a new home, and simply walking away from the one they couldn’t sell.
There is an EXCEPTION however:
If the borrower is relocating with a new employer, or being transferred by the current employer to an area not within reasonable and locally recognized commuting distance…
AND a properly executed lease agreement (that is, a lease signed by the borrower and the lessee) of at least one year’s duration after the loan is closed, and we have a copy of a cancelled check for the security deposit, evidence of the first month’s rent
THEN we can count the rental income. ALL mortgage programs (not just FHA) only give you 75% of the rental income as credit… So, if you rent the property out for $1000 we will only be giving you $750 of income to use to qualify for your new home.
So let’s say that your “old” home has a TOTAL payment (taxes, ins, everything) of $1500. You are able to rent it for $1000. In this case, we would be counting $750 as a monthly debt for you.
If you are relocating, and getting a new job, please read these FHA Guidelines about documenting your income. If you have questions about purchasing a home in NC using FHA financing, please call Steve and Eleanor Thorne Mortgage Banker in Cary , 919-649-5058.