Transition: Owner Occupant To Landlord
My husband and currently own and live in townhome in a very reliable rental neighborhood. We owe $71,000 it appraises in the high $90's.
We want to rent it and buy another home for our family in the range of $100,000. We have excellent credit, a moderate amount of cash and stocks, $10,000+,and our current home will rent for $800 a month.
Our main obstacle is that our stated income with out the rental is relatively low, on the up side our only debt is our mortgage. Also we would like to reserve as much cash as is resonable in order to rehab our next home as we've done with the first. What is our best option... go ahead I'm a strong girl I can take it! 
You'll need a min. of a 1 year lease. The bank will credit you with 75% of the rent as income. So make sure your rent covers you. Make a few phone calls to mortgage brokers in your area. Explain the situation until you find one that understands what you want to do. My husband and I did this about 6 years ago. I called about 5 or 6 brokers before I found one that understood what I wanted to do. It was frustrating, but worth it. Good luck!!
Thanks for the help, will I need to do a no doc loan, what are typically the highest income ratios I be able to find for this type of thing?
Thanks
If you look at the lenders section of this website you will probably find loans that don't require a ratio. Thus the term "no ratio". I am doing one of those right now.
Scott
I'd suggest 2 loans (i am not a mortgage broker)
1st loan) refi the townhouse to 90% LTV, if you have a 680+ you should be bale to use a stated loan and pull about 20k out. and most likely be able to cover your monthly pymt out of rent.
now you have 30k in cash. put 20% down on your new 100k home, and use a similar loan type AND show 10k in reserves. you should be able to get very good rates and favorabel terms.
If you can't let me know and i'll see if one of the brokers I know can work in your area - but I think you should locate a local broker willing to do the work - it will save you time and effort to work locally.
You guys are too kind, can't wait to tell my hubby these ideas!
Thanks