Jersey City, NJ · Member since 2018 · 2 posts · 0 votes
Hi! I purchased my home through a first time home buyers program. The house is 3 BR and 2.5 BR. I am considering renting out one of the spare rooms. Someday I would like to move out and keep this house and make it a rental. The issue is that I remember reading in my contract that the house has to be my primary residence. When I bought the house I didn't want to rent it out but now I do. Is there a way around this?
What do you mean when you say "I remember reading in my contract that the house has to be my primary residence"? If you purchased through some program where you were given financial assistance with the condition you would move in, and now you don't want to move in, you will be in violation of that contract. There may be financial penalties if you don't. There are programs that are specifically intended to get people into a residence they own and they are not intended for investment properties. The penalties should be outlined in the contract or should be available from the program sponsor.
If you mean you have an owner-occupied loan that has a provision that you move in, then you will be in violation of that loan. The lender can call it due if you don't occupy it.
If you're living there and just renting out a room you will probably be fine. Essentially you're getting a roommate and charging them rent.
If you're going to live there now, but rent it in the future, then it depends on which of the first two options is in play. If its some home buyer program, there are usually time limits. After that time limit, you're free to do what you want. If its a loan concern, then if you live there for "a while" then turn it into a rental you're probably OK if you live there at least a year.