House hack Issue with single family homes

[Bianca Nunes]

Hi everyone, I finally found a house that I'd like to pursue as a house hack. After reading a lot of books and forums about it, I'm ready. 

It's a single family home 4 beds and a full basement.

My plan is to rent out the 4 beds upstairs and live in the basement, BUT I got information from someone that I might have problems with lender and insurance because the basement is not a separate unit? All the content I read I never heard of that before...even Brandon and David mention all the time how you should get a single family or multi family (there are no multi families in my market...). 

What he said is that house hack is only for multi family. Does anyone know if this information proceeds? How do I verify it? State is MD.

Thank you

[Sam Lewis]

Legally you can purchase the property as a primary residence. It is up to you what you decide to tell your lender. 

From a lending perspective it is not illegal to rent out rooms, assuming you live there, but most counties have restrictions on number of non-related renters you can have living in the same dwelling (i.e. shared space).

For example, in Baltimore County you an owner cannot rent the same dwelling to more than two unrelated occupants. In other words, you cannot rent the 4 rooms to 4 people who happen to be unrelated or are not married. However, if you rented the upstairs to two married couples, legally you would be fine, since each couple is one set of "unrelated occupants." 

Hoping this makes sense. Let me know if you have any questions!