I was hoping to buy a second house in the same area where I live and then rent it out, but someone told me that I would only get a loan unto 625K on a downpayment of 40% since this is an investment property.
The other option is that I buy the townhouse as a second home. In this case, I would qualify for decent loan with downpayment of around 20%. The problem is that such a loan comes with a restriction that townhouse can be used exclusively for my purposes and not as a rental. Is this true for the entire 30 year life of the loan or only for first one or two years?
The third option is to buy another property as a primary house and move into that house and rent out the old house. Not sure if I want to do this as houses have gone up in price and something like my current house in a good area would cost $1.5M, a larger home would be more expensive, and we can't really move into a smaller home. From what I heard bank needs a good reason to give you another "primary home" loan.
So, any ideas and suggestion as to what I should do to qualify for a good loan, plus any finer points that I am missing?, so that I can own two houses (rent out one for income and live in another during retirement).
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I was hoping to buy a second house in the same area where I live and then rent it out, but someone told me that I would only get a loan unto 625K on a downpayment of 40% since this is an investment property.
The other option is that I buy the townhouse as a second home. In this case, I would qualify for decent loan with downpayment of around 20%. The problem is that such a loan comes with a restriction that townhouse can be used exclusively for my purposes and not as a rental. Is this true for the entire 30 year life of the loan or only for first one or two years?
The third option is to buy another property as a primary house and move into that house and rent out the old house. Not sure if I want to do this as houses have gone up in price and something like my current house in a good area would cost $1.5M, a larger home would be more expensive, and we can't really move into a smaller home. From what I heard bank needs a good reason to give you another "primary home" loan.
So, any ideas and suggestion as to what I should do to qualify for a good loan, plus any finer points that I am missing?, so that I can own two houses (rent out one for income and live in another during retirement).