Home not selling? You are thinking of renting it out and moving? Think Again!
The way loans used to work don’t work that way. That’s what I did back in 2001 or so when the market in Utah was depreciating. I just moved out of my home, leased it out and bought a new one.
FannieMae changed their rules though. You can't do that anymore. Why the change? There was something mysterious going on with many buyers this past year. They were upside down in their home, so they moved out, bought a home and left their home behind them. So FNMA changed the rules.
Heres the new rules:
If you move out of your current home and into another, you have to qualify for both payments. (Old days they would let you count the rent..but not anymore.
Not only would you have to qualify for both payments but you would also have to have 6 months of payments in a checking account for reserves for both properties.
The only exception to this rule is if you have 30% equity in the property. Than, they will be more lenient on your reserves and allow rental credit for income.
You can view the rules by clicking here.
To evaluate what you can do with your property go to UtahDave.com and fill out the form here.
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About the Author:
Utah Dave - Daybreak Neighboorhood Expert and Local Resident
My friends nicknamed me Utah Dave in high school because they said it didn't matter where we went in Utah, I would know how to get there and who we needed to talk to. The name sticks today as UtahDave has formed into a professional real estate network of Neighborhood Experts all across the state. I live in Daybreak with my wife and 4 amazing children. I enjoy dancing (which is how I met my wife Dawn) as well as traveling, coaching, and learning.
