Owner occupied conventional mortgage minimum time before moving

Owner occupied conventional mortgage minimum time before moving

Real Estate Investor · Rincón, Puerto Rico · Member since 2017 · 25 posts · 6 votes
Hi all, Newbie here. I'm sure this has been answered somewhere else but I haven't been able to find it. I just read this article: https://www.biggerpockets.com/mortgage/home/income-property-owner-occupied-financing-06811/ The article discusses a strategy whereby the investor moves to a new house to take advantage of owner occupied financing. Then, after some time, the investor moves to another house, to again take advantage of owner occupied financing and rents the old house. My question is: is there a minimum amount of time that you need to stay in an owner occupied house before moving to the next house (and get another owner occupied loan)? Are there parts of this strategy that perhaps I'm not thinking about? I'd like to use this strategy to create a student housing portfolio. I'm a young guy, and don't mind moving from place to place. I'm targeting multifamily properties, where before taking into account me living there and after taking into account the rehab, the property could generate a 12.5+ cap with the student rents. What am I not thinking about which could hinder my plan?
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  • Chris MasonPro Member
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    Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
    9y

    Nomad strategy. 

    At the closing table, you will generally promise to owner occupy for 12 months. 

    At the 12 month and 1 day mark, you can move onto the next.

    Fannie 5% is a better model match than FHA 3.5% for various reasons.

  • Real Estate Broker · Oakland, CA · Member since 2015 · 36 posts · 26 votes
    9y

    Thanks @Chris Mason for answering that as a lender. I recently gave a speech/talk about this very idea and had a few people ask about the occupancy requirements. I'll reach out to you directly to discuss in greater detail.

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