Duplex financing when I already own half

[Tristan Burch]

I think I have somewhat of a unique situation that I'm trying to figure out how to work out... I currently own (as my primary residence) 1/2 of a duplex. The owner of the other half has just agreed to sell me their half, which I'll be using as a rental. Is there a way to get owner occupied financing for a single loan that will cover both sides (effectively like refinancing mine side into a bigger loan that encompases both)?

[Matt Devincenzo]

Sorry I'm going to have to disagree with both of the above posters. Specifically in their mention of a FHA/conventional loan.

Based on what you've said the two halves of the duplex have separate APN or TINs depending on what is used locally. What that means is they are separate "fee simple title" parcels. This is different than a "normal" duplex that is two units on a single lot (e.g. 1 APN/TIN). In your case each half actually owns the land beneath it, they just have a common wall located on a lot line that has a 0' setback (you share the wall on the property line). FHA/conventional loan products are only for single properties, but may have separate units (up to four).

There are loan products for what you want, specifically you're looking for a "blanket" loan. That said the rates will be higher, and in all likelihood you'd get a better rate just getting a second NOO conventional loan.

The other option is to get a new OO loan and move into the other half. You don't have to refinance out of your original OO loan as long as you've fulfilled the stated OO period, which is 1 year assuming you signed an OO affidavit to that effect.