15 Nov Answering Listener Questions – Responding to You

By Heino Moeller

Regular listeners of Heino’s Home Show know that listener questions range from small decisions about renovations to huge concerns about refinancing, forbearance, and monthly mortgage commitments. This week’s listener questions are certainly no different! 

Second Home with VRBO Income

Janet from Spring HIll asks:

“I plan to buy a 2nd home that currently has VRBO income, which I plan to continue. Can I buy that as a 2nd home or can I purchase it as an investment property?”

Yes, you should be able to buy that as a second home instead of an investment property as long as a couple of guidelines are met. First, you cannot use the VRBO income in order to qualify for the loan. Secondly, the rental must not be under the exclusive control of another entity, like a management company, for example.

Forbearance

Allen in Mt. Juliet asks:

“My loan was in forbearance, and then I got a loan modification at the end. Can I refinance?”

This one is a bit tricky, so let’s step back and discuss forbearance for a minute. During the COVID pandemic, homeowners who were having difficulty making their mortgage payments were given the option of pausing their payments, otherwise known as forbearance.

What happens when you come out of forbearance depends on a few things. For example, if you continued to make your payments even during the forbearance period, you are clear to refinance immediately.

Alternatively, if you didn’t make payments during the forbearance period, then you won’t be able to refinance until three on-time payments have been made post forbearance.

Most lenders offered a few options to catch up on the payments that were missed during the forbearance period. You could pay it back in a lump sum, or you could increase your monthly payment by an agreed upon amount until the missed payments were caught up.

However, many lenders offered a third option: the missed payments could be added to the balance of the loan, thus modifying the original loan terms. In most cases, the other terms of the loan stay the same with the exception that the loan balance is now higher.

If this last option is what you did, then yes you may be able to refinance as soon as you have made three on-time payments at the end of the forbearance period.

So, since there are multiple answers to your question, it would be a good idea for you to contact a mortgage professional at Accurate Mortgage to discuss the specifics of your situation.

Truck Driving Income

Adam in Nashville asks:

“I’m a truck driver and I get paid by the hour. I’ve been offered a new position, but I will be paid by the mile. Can I still buy a house?”

Yes, you can still buy a home, but you might have to wait a while. When you’re paid by the hour, that’s considered predictable income. But when you’re paid by the mile, that’s considered variable income. 

Mortgage guidelines want to see a track record, a history of how much you end up actually earning when you’re paid by the mile. They’re going to require you to be paid by a mile for a year before you can use that income in order to qualify. It might be wiser to buy the house first and then switch jobs for the by-mile rate. 

Answering Your Questions

Have you got a simple or complex question about home ownership that you’d like answered? Call into Heino’s Home Show and your question may be featured in the upcoming podcast! Email your questions to heino@heinoshomeshow.com and your question could be featured on Heino’s Home Show, heard Sundays 5pm to 6pm on 99.7 WTN. You can also catch up on past episodes on the Heino’s Home Show podcast page (link) or wherever you listen to podcasts, including Apple Podcasts, iHeart, Spotify and Google Podcasts.

Accurate Mortgage is here to help you with purchasing a 1st or 2nd home, in addition to refinancing and more. For questions, applications, or anything else, visit our website or give us a call today.

Listening, Answering, Helping—Accurate Mortgage

Mortgage lending, refinancing, forbearance, and renovations/additions can be hard to understand in the context of home ownership. If you have questions, or are looking to borrow or refinance, we can help. Visit us online to get your mortgage rate quote or give us a call today at (615)833-0456!