- Posted January 26, 2014 by
This iReport is part of an assignment:
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- Mass Housing Home Loan for Condos Five Things You Need To Know
- Family Opportunity Home Loan Program for Parents of College Students
- Custodial Accounts Money For Your Children Not Your Home Purchase
Using Rental Income from a single family or condo to qualify for a home purchase
A common question when a buyer is trying to buy a condo or single family home is can I rent the other bedrooms to qualify? Income from within a primary residence or second home is called Border income which is normally not acceptable. I am going to talk to you about when you can use the income.
If you are a borrower with disabilities and receives rental income from a live-in personal assistant the rental payments can be considered as acceptable income in an amount up to 30% of the total gross income that is used to qualify the borrower for the mortgage loan. This means if the mortgage payment is 1,000 the maximum the rental income can be used to qualify would be 300 dollars and the reason is if you exceed 30% of the debt obligation the property is an investment.
Personal assistants typically are paid by Medicaid Waiver funds and include room and board, from which rental payments are made to the borrower.
To verify border income your lender will request documentation of the boarder's history of shared residency (such as a copy of a driver's license, bills, bank statements, or W-2 forms) that shows the boarder's address as being the same as the borrower's address. The lender will also request documentation of the boarder's rental payments for the last 12 months (such as copies of canceled checks).- Boston Mortgage Lender & Home Loans