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Primary Residence vs. Investment Property
Hello All,
I know there are several posts here on BiggerPockets regarding treatment of primary residence vs. investment property but this question applies to my specific situation. We are looking to purchase a rehab, make renovations, and sell within 6 months. Clearly, this falls into the investment category.
However, the property is closer to my work than my current home and my family situation would allow me to live there full time during the rehab. Can I finance this as a primary residence (even though I have intentions of selling short-term) by living there during the rehab?
Thanks!
You can do it as a second home if you are planing to stay for less than 6 months there.
Originally posted by @Account Closed:
You can do it as a second home if you are planing to stay for less than 6 months there.
Is this true if the home is not located in a resort/mountain area? It's within 50 miles of my current home and not a beach house or anything, but it is closer to my location of work.
@Tim Heindl you asked a question about financing in the forum for taxes, legal issues, contracts, and self-directed IRAs. You might get more responses if you posted in the forum for conventional mortgages:
https://www.biggerpockets.com/forums/49-private-co...
Best of Luck with Your Real Estate Investments!
I suggest: just change your mind - make it your primary for 1 year+, and go for all the FHA-approved low deposit stuff, perhaps with 203k rehab loan thrown in?
Do you really want/need to put yourself under such a tight timeline, unnecessarily?
[Note: Even if your current primary is an FHA loan, you might be able to refi out of that one first? Afaik, the only hiccup (so long as you have enough equity) would be that being so close to your first primary, any income from that one won't be included in your DTI]. My 2c...
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Is the current state of this property livable? I don't think a primary residence loan will loan on a property that isn't livable. Out-dated, sure, but that's different. If you want to purchase the property via primary residence loans, then just make sure you truly take up residency there by having utilities and such in your name. Have a backup plan that selling in 6 months just might not work out or happen. Will it make a good rental? Will you be fine with holding onto it for longer?
Originally posted by @Tim Heindl:
Originally posted by @Account Closed:You can do it as a second home if you are planing to stay for less than 6 months there.
Is this true if the home is not located in a resort/mountain area? It's within 50 miles of my current home and not a beach house or anything, but it is closer to my location of work.
That depends from Lender to Lender. They may agree to it if you could provide a conviencing motivation letter because the property is too close to your current primary. They should be good as long as you could prove that this property won't be used for generating income.
Thank you.