[Rec]

residence) home in CA (1st home is a rental property in NJ)? Here is the scenario: My wife and I bought our first home in New Jersey in 2005. We lived in that home for 15 months. Then we had to move to California because of the job in end of 2006. We tried to sell the house in New Jersey, but it did not sell. We made the mortgage payments on the empty house for over a year thinking it will sell (since we kept getting activity on the house). We rented an apartment in California when we moved here. The house in NJ did not sell till date, so we decided to put it for rent. We rented it out in May 2008. So, now it’s a rental property. My wife and I are thinking of buying something small in California. We have good income and excellent credit. The rent of NJ house covers 80% of the mortgage on that house. What I am trying to find out is, what could be issues for us getting a mortgage for another house which would be our primary residence in California?Thank you all in advance who put efforts in answering my question.

[zeuz]

The big issues are the income, assets and credit-worthiness of the borrowers.1. Income. Your income on your rental will be included. In the past, rental income was given 75% (i.e., assumed 25% vacancy rate). In the current world, the rental income may be assumed to be lower.2. Assets. Do you have a substantial sum of money for a downpayment? I would recommend at least 25% under the circumstances plus at least 6 months additional resources.3. Credit-worthiness. Are your credit scores above 700?