(We would still kind of feel like jerks though because after we asked them if they wanted to stay in the house for another year, they’ve obviously understood we would sign another year long lease.)The house was built for about $84k in 1999.We do not currently have anything identified to buy (although there are off market properties we would be interested in IF the owners wanted to sell, and we’ve been meaning to contact some of these people) so we are worried about tax implications if we can’t do a 1031 exchange—of which we have very little knowledge.The house has been very easy to rent because it looks great and is in a great location.

When meeting with the smaller local bank they where treating it like a second home mortgage and they understood that we wanted to use it but also rent it out seasonally.

Did the loan officer go over your fees line by line so you understood them?

in real estate I would have taken advantage of the STR loophole, and also gotten more mentorship for someone that understood the market I was in instead of using general advice. woulda been less headache more revenue. 

@Joe CarlsonI have never been self employed but the way I always understood it was that those with earned income payed into SS.  

What I understood you to say is that you pay all costs even if there is no money from rents to do so. 

I'm all for late payers (see my previous comments) but I never understood why my rent payments have to be tied to when they get paid. 

I've always understood that you cannot get loans like that unless your income statements show that you can afford it aka debt to income ratios. 

Again, i may not have understood clearly what you are stating.

We let them know we couldn't help them in the end, and they understood.