U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
 
Old 09-05-2012, 09:55 AM
 
10 posts, read 45,614 times
Reputation: 12

Advertisements

Hi, I currently own a home (paid off) and want to buy a home in a better school district for my child within 20miles away. I do not want to sale my current home as I want to keep it as a back-up or if someone wants I can rent it out or just let my in-laws live in it.

Question. Is it possible to get a owner occupied mortgage on my second home? If so, how do I explain this to the banks? Keep in mind that my first home is paid off.

Thank you.

Ceci
Quick reply to this message

 
Old 09-05-2012, 10:11 AM
 
104 posts, read 252,669 times
Reputation: 56
yes you can own two homes and have two separate mortgages. not sure if you have to declare one as a primary home and one as a second/vacation home. a third home would be an investment property even if you occupy it. just different way to get a mortgage usually putting at least 35% down.
Quick reply to this message
 
Old 09-05-2012, 08:06 PM
 
Location: Austin
7,205 posts, read 18,266,733 times
Reputation: 9804
People move everyday around the country. Many people buy their new house without selling the first.
Quick reply to this message
 
Old 09-06-2012, 09:43 AM
 
Location: Northern VA
7 posts, read 40,287 times
Reputation: 13
The best scenario would be to make your new home your primary and as a default your current home would become your 2nd home. As long as your are currently employed and credit history is good you would get approved no problem since the other house is completely paid off. You would just have to provide explanation why you are moving, and if you actually spend the majority of your time at the residence it would be treated as a primary. Moving to a better school district is a valid reason. It happens quite often.
Quick reply to this message
 
Old 09-06-2012, 11:20 AM
 
28,449 posts, read 72,693,835 times
Reputation: 18469
Default Whole bunch of questions that need to be addressed...

First off to directly answer your question it is IMPOSSIBLE for a borrower to have other than ONE owner occupied primary residence. The home that is your LEGAL residence is what the lender will want you to have cash 20% down payment for standard financing. You will be required to sign documents stating that you WILL occupy that home as your primary residence. Lying is something that CAN AND HAS resulted in lenders coming after borrowers for in both civil and criminal cases.

If you intend to retain ownership of another residence and you do NOT USE IT as a secondary residence it will be an investment property. If you own it free and clear it will likely NOT hurt your ability to borrow for new primary residence. It will NOT be permsible to consider this a "vacation home" and you will not be able to treat it as such for tax purposes -- Is My Vacation Home Tax Deductible | Vacation Home Tax Deductions

If you intend to move to a better school district this is completely fine but if you intend to merely own a second home and attempt to remain in your existing home this can lead to problems: Oak-Park-school-officials-say-probe-led-to - Chicago Sun-Times
Quick reply to this message
 
Old 09-06-2012, 04:12 PM
 
Location: Ashburn, VA
989 posts, read 2,519,040 times
Reputation: 640
Why don't you just take a mortgage out on your current home (cash out refinance) to buy the second one with?
Quick reply to this message
 
Old 09-06-2012, 04:44 PM
 
Location: Vermont
5,439 posts, read 15,015,027 times
Reputation: 2641
I'm assuming this is about how to obtain a mortgage. It sounds like you will live in the new home. That becomes your primary residence. You would put that on all applications.

It shouldn't be a big deal assuming you can pay for the new one and the taxes on the old one on paper.

Last edited by joe moving; 09-06-2012 at 05:03 PM..
Quick reply to this message
 
Old 11-23-2013, 09:34 PM
 
1 posts, read 23,256 times
Reputation: 11
Default Owner occupied mortgage on second home, child with disability.

Quote:
Originally Posted by chet everett View Post
First off to directly answer your question it is IMPOSSIBLE for a borrower to have other than ONE owner occupied primary residence. The home that is your LEGAL residence is what the lender will want you to have cash 20% down payment for standard financing. You will be required to sign documents stating that you WILL occupy that home as your primary residence. Lying is something that CAN AND HAS resulted in lenders coming after borrowers for in both civil and criminal cases.

If you intend to retain ownership of another residence and you do NOT USE IT as a secondary residence it will be an investment property. If you own it free and clear it will likely NOT hurt your ability to borrow for new primary residence. It will NOT be permsible to consider this a "vacation home" and you will not be able to treat it as such for tax purposes -- Is My Vacation Home Tax Deductible | Vacation Home Tax Deductions

If you intend to move to a better school district this is completely fine but if you intend to merely own a second home and attempt to remain in your existing home this can lead to problems: Oak-Park-school-officials-say-probe-led-to - Chicago Sun-Times
Chet,
I think you are spot-on on your reply. I have also heard that if you have a child (with a disability), or elderly parent, you can purchase a second home for them, and have 2nd home qualify, and be consider an "owner occupied" also qualify for "owner occipied" mortgage rates, IF the second home is purchased for your disable dependant (child), and he/she is the one primarly residing on this second home, but I am the one qualifying and paying the mortgage. Are you familiar with this provision?, do you where can I get more information about it? . Are there special lenders I can contact to seek more help on this topic? Thanks!
Quick reply to this message
 
Old 11-23-2013, 11:07 PM
 
Location: MID ATLANTIC
7,846 posts, read 19,164,896 times
Reputation: 8671
Quote:
Originally Posted by Palomap View Post
Chet,
I think you are spot-on on your reply. I have also heard that if you have a child (with a disability), or elderly parent, you can purchase a second home for them, and have 2nd home qualify, and be consider an "owner occupied" also qualify for "owner occipied" mortgage rates, IF the second home is purchased for your disable dependant (child), and he/she is the one primarly residing on this second home, but I am the one qualifying and paying the mortgage. Are you familiar with this provision?, do you where can I get more information about it? . Are there special lenders I can contact to seek more help on this topic? Thanks!
I just recently started to research this for someone, from the Fannie guide:

The following table describes conditions under which Fannie Mae considers a residence to be a
principal residence even though the borrower will not be occupying the property.
Borrower Types Requirements for Owner-Occupancy
Multiple borrowers Only one borrower needs to occupy and
take title to the property, except as otherwise
required for mortgages that have guarantors
or co-signers. (See B2-1.2-04, Continuity of
Obligation.)
Parents wanting to provide housing for their
physically handicapped or developmentally
disabled adult child
If the child is unable to work or does not have
sufficient income to qualify for a mortgage
on his or her own, the parent is considered the
owner/occupant.
Children wanting to provide housing for
elderly parents
If the parent is unable to work or does not have
sufficient income to qualify for a mortgage
on his or her own, the child is considered the
owner/occupant.
Note: If a property is used as a group home, and a natural-person individual occupies the
property as a principal residence or as a second home, Fannie Mae’s terms and conditions
for such occupancy status as provided will be applicable.

The cut and paste is rough, so you can find it here in the Fannie Mae guidelines, page 269.
https://www.fanniemae.com/content/guide/sel102213.pdf

You most likely will need someone that can take you Fannie Direct (ie, no overlays) -
Quick reply to this message
 
Old 11-24-2013, 05:22 AM
 
Location: Southern California
4,450 posts, read 5,493,707 times
Reputation: 2210
Quote:
Originally Posted by Palomap View Post
where can I get more information about it? . Are there special lenders I can contact to seek more help on this topic? Thanks!
You don't need "special lenders" they either do it or they don't. I think more often than not , they can do it , but the person that you talk to doesn't know they can do it.

I don't think you'll have problem trying to find a mortgage broker to do this type of loan.

Also nice to see people actually read the Fannie Mae guidelines.

This is a year old thread which, you might actually get better traction and there will be less confusion if you just started a new thread. Reading old threads with bad information is just too frustrating.

Last edited by thelopez2; 11-24-2013 at 05:31 AM..
Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


 
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:
Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

© 2005-2020, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top