I bought my first house about a year ago (300k, 20% down, 4.52% interest). After about 6 months, we were able to buy our dream house which was a short sale (415k, 15% down, 5.4% interest). The second loan was an investment loan.
We’ve spent 5 months doing renovations to the second house. We are just now moving in and we plan to rent out the first house for about $2200 per month.
I want to refi, but i was told that i need several months of rent to refi both houses. Is this true? I really want to refi right now, as rates are good. my credit score is 780ish.
My bother said should just refi the investment loan now, then wait 3 months and refi both loans again, depending on rates. What do you think?
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Who told you that you need rental history? Some lenders may require rental income history, others might be fine if you have a signed rental agreement. However, you may need them only if you need rental income to qualify for both loans. Since you were able to buy the second house without any rental income, you should not need rental income to qualify (assuming your other income hasn’t changed since you bought the second home). You should be able to refi both of them now.
Also I’m a little surprised you were able to get an investment loan with just 15% down – I thought 25% was required. And if it’s not required but you have the cash, you would probably get better loan terms with 20% down on the primary and 25% down on the investment property. And since you’ve done some work on the second home that will become your primary, an appraisal might be enough to bring you up to the 20%.
Zillow is where I found the company that said I need 3 months of rental income.
So you do need the rental income to qualify for refi? How were you able to buy the second home in the first place?