STR Financing in Gatlinburg Pigeon Forge Smoky Mtns

[Account Closed]

My wife and I are thinking of doing things a bit different than most. We want to get into a str cabin in the smoky mtns, but don’t have the funds to come up with the downpayment at the moment. We’re thinking that this time next year we could sell our home and live in a camper for a year, that would give us the money we need to put down on a cabin and start working our way into financial freedom instead of depending on my 9-5 job. We have two kids under 3 so we know it’d be tough for a year, but we think we can make it work to get us to where we want to be financially in the future. So could we potentially do a primary mortgage on a cabin as if we were purchasing it to live in it to take advantage of a lower down payment, then rent it out through Airbnb etc.? Or would we still have to do a vacation home loan (10% down) or investment loan (15% down)? Our biggest concern is that if we absolutely hate living in a camper we want to have an exit strategy to be able to get a home loan again so we can get back into a house (without having to sell the cabin.) Trying to tag @parkerborofsky but it’s not letting me. Welcome input from anyone though!

[Parker Borofsky]

@Account Closed - weird it wouldn't let you tag me!  Thank you @Avery Carl!  Occupancy is definitely important and you never want to commit mortgage fraud - it's really not worth it.  If you are borderline on the occupancy, my advice would be to continue to save and also see if you have any family that would be willing to give you a gift since gift funds are allowed on second homes.  If you put 10% down on a second home, you would have to show that you have at least 5% of the purchase price of your own funds and the rest can be a gift.  You may also want to look into a home equity line of credit or a cash-out refi on your current residence.  Another idea is to sell your current home, purchase a less costly primary with a USDA loan (if you qualify) @ 100% financing and use the proceeds from the sale of your home as the down payment for a cabin. You could also sell your home, use the proceeds to purchase a cabin and actually live there as your primary home for at least a year.  After 12 months, if you decide you would like to purchase a home somewhere else and use the current home as investment, that should be fine.  Just remember- it will need to make sense to underwriting in terms of distance to work/if you can work remotely, etc... Hope that makes sense!