Will I be able to qualify for another mortgage?

[alpha916]

I have a house that I am renting out, but I want to buy another house and also rent it out.

My current house carrys a balance of 117k, 5.75% APR, monthly payment $959/month, 30 year mortgage. I bought this house 3 years ago and is NOT underwater. The market price for the house is around $135k.

I want to buy another house around $100k with 20% down, so I'm looking about a 80k mortgage.

My income is about 80k/year. No car loans, perfect payment history, but I have a lot of CC debt (about $16k).

My TU is 716 and my EQ is 662. Will I need to work on my FICO before trying to apply for the 2nd mortgage? I have a few grand in the bank right now, which I can either save for the downpayment OR pay off a large chunk of my CC debt. What should I do?

[ShanetheMortgageMan]

What are the minimum payments on the $16k credit card debt?

How long have you been renting the home out?

You mentioned you had a "current house", is that the home you are renting out, or is that your own home?  Where do you currently live?  Does the $959/mo include taxes & insurance?

[alpha916]

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@ShanetheMortgageMan wrote:

What are the minimum payments on the $16k credit card debt?

How long have you been renting the home out?

You mentioned you had a "current house", is that the home you are renting out, or is that your own home?  Where do you currently live?  Does the $959/mo include taxes & insurance?

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The minimum payments on the credit cards amount to about $400 total but I have been overpaying them for months now. I pay about $1000/month on them.

I have been renting out the home for about 3 years now. My rent total is more than my mortgage.

Yes I do own the house I am renting out, but I live in an apartment.  The $959/month is total, including taxes and insurance.

[BrianB_The_Loan_Professor]

If you have been showing the rental income for two years via taxes you can use it to offset the costs of the mortgage on the first

leaving your income available to qualify you for the mortgage

given the numbers you provided is not enough

we would need to know also

how much the rent is on the current home (you can only count 75%) 

how much your personal rent is (it will be counted against you)

and then we can estimate the costs of the new loan

on 80k loan you shouldnt be looking at more than $600-$700 a month max

so unless you apartment is very high your income should cover this and allow you to purchase

for an investment you will need reserves as well