All Forum Posts by: Jay Chung

@Jay Chung If the mechanicals for the duplex are in the basement it may be better not to give the tenants access. For insurance you often have to have a certain amount of access to get to furnaces, hot water heaters, and electrical panels.

In my basements tenants have access to they totally disregard the access required and block the pathways needed for access.

In one building the tenants accumulated so much junk over the course of their tenancy that I was forced to get a 40’ roll off dumpster to get it emptied for a sale. And the tenants still lived there, they had just been putting old mattresses, broken furniture, and crud there for years. They then refused to accept responsibility for it.

I just think basement access is generally a bad idea.

But my solution in your case would be to frame out a dividing wall of 2x4s and either drywall or if the basement is prone to taking on water then I’d look for something waterproof as opposed to the drywall. There’s a rigid plastic type material that’s used in dairies and on farms that I’ve seen used.

@Jay Chung I would say that is up to the particular lender. If the buyer certifies that they are going to use it as the primary resedence and it has a use and occupancy permit that alows use as a personal residence then I don't see why a lender would not. 

But again it will depend on the particular lender and how deep they look into the deal. They may not look for, Notice or care about the zoning. I believe commercial zoning allows for use as a residence. Zoning codes vary by area so I would check the local zoonning codes and call the permitting office to see if it has a use and occupnacy permit for a SFH.

If it is a single unit 2 bed/2 bath you can definitely get a residential loan. Here is most likely what is going on:

The city changed the zoning districts and they upzoned this area from residential to commercial/multifamily because they need higher density housing. The previous owner then saw an  opportunity to sell it for more than it was worth before because a developer can turn it into a much larger asset and make a lot of money. 

In this scenario the property as a residential property is normally a terrible deal because they are basically selling it as commercial land so you might want to look into that. If you are a developer and plan to tear down the house and do something else with the property then you wont be able to get a residential loan because you are going to tear down the bank's collateral and then do something else which is definitely against the rules.