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.
So I am on my condo board and I have read that too many renters make it hard for folks to get mortgages.
Since my condo does not have any rules or fees regarding renting or leasing your units I dont have hard facts about the occupancy of units.
Also what is the definition of a rental according to a bank?
For instance I have someone who rents it off season furnished and uses it in summer.
Someone who went to nursing home and nephew has been there last few years.
A guy who lets his friend live in unit as long as he covers monthly cost
A women who has a roomate.
Unmarried couples where only one person is on deed.
Rentals where owner still declares it for tax exemptions as primary residence.
two units no one lives there at all, one is an estate the other owner is out of country for work for three years.
One in a LLC.
Very very few fit the model of an investor bought it, rented it out full time.
So if Fannie/Freddie or a bank asks me what percentage is rented how would I know. Honestly, I only live there two years and most folks I waive to. I dont ask them detailed questions.
It is not black and white what is a rental and what is not and what do they think the board tracks this all day long. Maint is on autopay for nearly everyone and as long as they are paying I dont have reason to get too noisy.
So how do most condos fill out form when asked how many units are rentals?
So I am on my condo board and I have read that too many renters make it hard for folks to get mortgages.
Since my condo does not have any rules or fees regarding renting or leasing your units I dont have hard facts about the occupancy of units.
Also what is the definition of a rental according to a bank?
For instance I have someone who rents it off season furnished and uses it in summer.
Someone who went to nursing home and nephew has been there last few years.
A guy who lets his friend live in unit as long as he covers monthly cost
A women who has a roomate.
Unmarried couples where only one person is on deed.
Rentals where owner still declares it for tax exemptions as primary residence.
two units no one lives there at all, one is an estate the other owner is out of country for work for three years.
One in a LLC.
Very very few fit the model of an investor bought it, rented it out full time.
So if Fannie/Freddie or a bank asks me what percentage is rented how would I know. Honestly, I only live there two years and most folks I waive to. I dont ask them detailed questions.
It is not black and white what is a rental and what is not and what do they think the board tracks this all day long. Maint is on autopay for nearly everyone and as long as they are paying I dont have reason to get too noisy.
So how do most condos fill out form when asked how many units are rentals?
The bank looks at 3 classifications, Primary, second home, and investment property.
Primary the owner lives there full time.
Second home the owner uses it as a vacation home and may have it in a rental program, but the owner either does, or has the ability to use it for at least 1 week out of the year. The fact that he doesn't is irrelevant, if he "can" then its a second home.
Investment property = the owner cannot use it, its rented year round to a tenant.
Here's the choices: Owner Occupied (OO) | Non Owner Occupied (NOO)
Everything on the second NOO side (most commonly by a "tenant") is a rental.
And being NOT occupied by the owner Insurance and Taxes are different.
(even if the tenant is related or just seasonal, etc)
Quote:
So how do most condos fill out form when asked how many units are rentals?
For instance I have someone who rents it off season furnished and uses it in summer.
One in a LLC. - LLC is irrelevant. We have houses that arent' in a rental program at all that are second homes.
Second Home
A women who has a roomate.
Unmarried couples where only one person is on deed.
Primary Home
A guy who lets his friend live in unit as long as he covers monthly cost
Gray area between full time rental (Investment Property) or second home. Just depends if he ever comes down and stays with his friend
Rentals where owner still declares it for tax exemptions as primary residence.
two units no one lives there at all, one is an estate the other owner is out of country for work for three years.
Do they use it? Or have the ability to use it. If so its a second home.
Now with that said, the same owner can only have 1 second home. If the same person has 3 units, even if he comes down and uses all three at various times of the year, then only 1 can be considered a second home, the others are investment properties.
I'll also add, we originally thought that anything that the owner didn't live in was an investment property if it was in a rental program. Took a nice little visit from the lawyer for a failed sale, and a consult with our attorney and looking into the guidelines to figure it out.
Some mortgage companies lump together the Investment and Second Homes, but the majority have switched to breaking it down between the 3, or lumping together the primary and second home.
So if Fannie/Freddie or a bank asks me what percentage is rented how would I know........So how do most condos fill out form when asked how many units are rentals?
I used to fill these out. Every form said 100% owner occupied. We never tracked it, so it is assumed they are 100% owner occupied. If the bank wants to knock on doors and figure it out, they are free to do so. It's not my job nor the HOA/Condo's to do the bank's work........ for free.
Renting your unit? Dont ask. Dont tell.
If your tracking rentals, owner occupied, second homes, investment property, inherited, etc, blah, blah, YOUR DOING IT WRONG AND WASTING YOUR TIME..... FOR NOTHING.
Last edited by 399083453; 04-09-2015 at 02:52 PM..
I used to fill these out. Every form said 100% owner occupied. We never tracked it, so it is assumed they are 100% owner occupied. If the bank wants to knock on doors and figure it out, they are free to do so. It's not my job nor the HOA/Condo's to do the bank's work........ for free.
Renting your unit? Dont ask. Dont tell.
If your tracking rentals, owner occupied, second homes, investment property, inherited, etc, blah, blah, YOUR DOING IT WRONG AND WASTING YOUR TIME..... FOR NOTHING.
Up to now the prior President of condo board just refused to fill them out. Most likely I will tell Managing agent put down whatever you want. If he puts 100% I dont care.
In condos that dont have rules on renting, no fees. etc. I dont have a list I can just grab to tell unit status.
banks are funny, boards are volunteers so why should we do their work. Buyer or Seller or Bank are only three people who care about the sale closing
We track it by including with the regular owner update forms "rental company" and of that the options include full time rental and self rental.
It's actually quite handy info to have, both for information purposes and give us a go to if we need to get into the unit and the owner hasn't given us a key or if we aren't able to reach the owner. Or...and we are moving away from this, a friendly phone call with a "this is just an FYI that the amenity rights have been revoked for this unit" (and the subsequent pressure from rental company on the owner ) gets money coming in fast for the delinquent owners.
The condo can pass rules regarding rentals, but the board/ management company has to be prepared to enforce them. Our experience is the people who are a PITA are usually renters. Short term rentals can be prohibited to prevent transient occupancy. City regulation may address that issue for tax reasons.
If people are failing to pay their monthly, then a lien can be placed on the unit. Autopay is great for everyone.
It is common in 55+ communities to do a census so that "youngsters" are not endangering the communities 55+ status.
We track it by including with the regular owner update forms "rental company" and of that the options include full time rental and self rental.
It's actually quite handy info to have, both for information purposes and give us a go to if we need to get into the unit and the owner hasn't given us a key or if we aren't able to reach the owner. Or...and we are moving away from this, a friendly phone call with a "this is just an FYI that the amenity rights have been revoked for this unit" (and the subsequent pressure from rental company on the owner ) gets money coming in fast for the delinquent owners.
we dont have a rental company, 100% of complex manages own rentals.
I would think a better bank metric than rentals would be number of units with mortgages which is where real default risk is.
Our new problem is a lady who is turning unit into flop house, renting out rooms and even 1/2 a room. She lives there but has ads out by the month.
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 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.
