trying to calculate exactly how much cash i need

[Mazzinator]

So i'm looking to buy an owner occupied house in may-ish of 2015...then buy an income property later next year, and i'm trying to figure out exactly how much cash i need to save and where to save it.

The owner occuopied house would be a VA loan, probably 0% down payment, and the IP would be about $80k (renting for about $1k/month) These are very loose numbers because i just need a time frame on when exactly to start saving. I like to "invest" my money first, then save for the down payment and reserves.

However, i don't know what exactly i'll have to prove to a lender for the IP. Do they count money in a taxable account for reserves? Do i have to prove i had the DP and reserves and closing costs for 3 months prior to closing, or applying for the mortgage? Is my reserves based on the piti of the owner occupied place plus new mortgage?

Thanks for all your help!!!

[tracylayton]

I would go ahead and contact a lender now to find out those answers. You will most likely have to put down 20% on an investment property. I have 3 investment mortgages, and I felt like I was jumping through hoops each time to get thru underwriting (and I had a credit score over 800). I also paid all of my own closing costs...about 6% of the sales price. Good luck!

[Cheddar Stacker]

Put together a personal financial statement. Talk to a banker or two. Maybe reach out to Moose Out Front on this forum (commercial banker).

I don't think you need to "prove" too much. Money invested in a taxable account will help. 20-25% down payment on the rental is almost always required. The property itself is the majority of the collateral for the bank loan, but showing them your finances will help sway them to loan out funds.

Also, some banks will not want your business, and that's fine. Some either dislike rental RE, or they already hold too much and they need to diversify. So talk to a few banks. Good luck.