Mortgage company pulled a switcharoo

[Nick Brown]

I got a contract on my first rental property two weeks ago. Duplex. I intend to live on one side and rent other side out. I was pre-approved by a mortgage company. Everything was going fine after it was under contract, and I had gone through several days of emails with the mortgage company concerning points/interest rates/down payment amount. We agreed on 3.125% conventional loan, 5% down. Everything seemed fine. Today at 4:45, I get a call from the mortgage company saying that “corporate” is now requiring 15% down because this will be an income-producing property. The fact that I will live there is irrelevant. I had been dealing with the same guy all along. He said he was confused by this, as no one in the company had any concern about this In the previous days. He couldn’t tell me why it now was a concern.

Does any of this seem normal? Is it normal for a mortgage company to not do 5% down on an owner occupied duplex?

I have no problem making calls to other mortgage companies on Monday, but if I ask here first and find out that this is totally normal, I won’t bother.

Thanks everyone