Refinance on single family house with MIL unit

[Jacky Fan]

I'm currently in a refinance road block.  I rent out my single family house to 2 tenants since it has a MIL setup.  However, the appraiser have a note that said zoning law prevent my home to be rented to multiple tenants/families.  Therefore, the lender underwriter team is hesitant to approve the loan.  I have no idea of such law.  Anyone encounter this situation before?  Any suggestion to move this loan forward? 

[Joe Splitrock]

Originally posted by @Jacky Fan:

I'm currently in a refinance road block.  I rent out my single family house to 2 tenants since it has a MIL setup.  However, the appraiser have a note that said zoning law prevent my home to be rented to multiple tenants/families.  Therefore, the lender underwriter team is hesitant to approve the loan.  I have no idea of such law.  Anyone encounter this situation before?  Any suggestion to move this loan forward? 

 It depends on the locations, but in many areas you can't just convert single family to multifamily. There are many reasons for this. I am going to guess you purchased it as a single family home, whether you or someone else added the MIL suite, it is not a legal unit based on what they are saying. Probably your best bet is to contact the city or county and see about getting it rezoned.