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Refinancing a vacant or rental house

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Anonymous
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Refinancing a vacant or rental house

I have been trying to sell a house for over a year and since have moved out of the area so the house has been vacant for a year.  I am now trying to either rent it or sell it, but because of a rate increase coming up I will need to refinance if I end up renting the house.  How is a mortgage different on a vacant/rental versus a primary residence?  Should I refinance before I rent it or after?
Message 1 of 3
2 REPLIES 2
ShanetheMortgageMan
Super Contributor

Re: Refinancing a vacant or rental house

Typically you'll need to have the house off the market for 6 months before financing will be available again.  Rental/investment properties require better credit, lower debt to income ratio, and a lower loan-to-value than primary residences.  If your debt ratio is hurting, then as long as you can provide a signed rental contract on the rental property then 75% of the rental income can be used to offset your debt payments.
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Message 2 of 3
Anonymous
Not applicable

Re: Refinancing a vacant or rental house

Thanks for the info.  Sounds like I'm going to have to wait this out to see what happens before I can do anything.
Message 3 of 3
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