how to finance second property

[SantaMar]

i own a primary.  i own an investment property. (my investment property was purchased 6 months ago because the deal was wayyyyy to good to let go!  it was free!)

there is a second investment property near my work that i am greatly considering to move on.  he property is listed for 70k.  might be able to get it for 60k.  in any event, i need to figure out a way to best finance this. 

i contacted lenders who will write a small note, under 50k.  my DTI will work and my w2 support the numbers.  the X factor the i have come to realize is the lenders need to see 6 months reserves on all properties i own and 20-25% down plus closing costs....

for a 70k property i need a down payment of 14k plus closing costs PLUS 6 months of reserves of my primary residences mortgage taxes insurance ( 9 k) and six months of taxes and insurance for investment property number 1 ( 2k )...thats comes in around 30k when all is said and done to be sitting in my account, seasoned !

this troubles me a bit, i might just have to get a HELOC on investment property number 1 and pay the difference in cash.  the guidelines are more flexible.  closing costs are minimal.  draw period for 10 years.  i dont need seasoned money like i would for another mortgage....

[ShanetheMortgageMan]

Usually it's 6 months PITI for the subject investment property + 2 months PITI for each other financed 2nd home or investment property. 

Minimum you can put down on an investment property is 15%, but you avoid PMI if you put down 20% and the rates get a lot better if you put down 25%.

If you can raise the funds by getting a HELOC on your primary or the investment property (which I'm not aware of any lenders doing HELOC's on investment properties anymore) and can purchase the new home for cash then you may even be able to pick it up for a better price.