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So if I plan on buying a duplex as a private residence (Georgia), and one of the units is currently rented with a year lease. My main goal would be to turn the whole thing into a single family home once the tenent leaves. Given that:
1) If it is partially rented out, will that affect the types of mortgages I can apply for. Will it be treated like an investment property by mortgage property?
2) Does the lease essentially transfer with the property? Does anyone have experience with paying a tenent to move?
3) Any other issues you can think of that would be different than buying a SFH?
Where are you going to be living? Are you going to reside in the empty half of the duplex ?
If you do, then this is an owner occupied multi- family for mortgage loan purposes. Not an investment home.
If you plan to put another tenant in the vacant half, if you don't plan on living there, then this becomes an investment property.
The lease transfers with the property. You have that tenant until the lease ends. You can try buying them out by doing something like paying security deposit, first ,last month's rent and maybe some more cash on a new place to encourage them to leave. They don't have to go though.
I would be living on one side, with plans to occupy both sides once the tenant vacates. Is an "owner occupied multi- family" mortgage rate about the same as for a single family home? Should the fact that it is half rented help me in getting the loan?
Quote:
Originally Posted by willow wind
Where are you going to be living? Are you going to reside in the empty half of the duplex ?
If you do, then this is an owner occupied multi- family for mortgage loan purposes. Not an investment home.
If you plan to put another tenant in the vacant half, if you don't plan on living there, then this becomes an investment property.
The lease transfers with the property. You have that tenant until the lease ends. You can try buying them out by doing something like paying security deposit, first ,last month's rent and maybe some more cash on a new place to encourage them to leave. They don't have to go though.
I would be living on one side, with plans to occupy both sides once the tenant vacates. Is an "owner occupied multi- family" mortgage rate about the same as for a single family home? Should the fact that it is half rented help me in getting the loan?
Ask your loan officer. I imagine it will be higher but not deal killer higher. Maybe ~1/2 a point or so.
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