O/O loan on Investment Property

[Tom C]

I was in the mortgage business for a long time, and I remember if someone didn't have a mortgage on their credit report, they could in theory do a investment property as if it was O/O.

Has that changed? Are there any road blocks that could stop this? What proof would a lender want to see if they didn't believe it was for your primary residance, Etc....

[Greg G.]

Come on dyingbreed, doing this would be fraud. Can it be done and should it be done are 2 different quetions.

That's why they have the question on the loan application, "Do you intend to occupy the property as your primary residence?, Yes or No?

Lenders try to protect themselves by reviewing W-2s, paystubs, 401k and bank statements where they will have a mailing address listed, that will give the underwriter ammo for questions. Most lenders won't approve an owner occupied loan on a property that's smaller/less expensive than the free and clear larger/more expensive "investment" property.

There's no reason you can't refi the o/o home at o/o rates and use the cash to buy the investment property.