Milwaukee, WI · Member since 2016 · 3 posts · 0 votes
I want to purchase my first rental property with a mortgage instead of a conventional loan so I can take advantage of the homestyle/homeready programs which allow you to include renovations in the loan instead of conventional loans that require 15% down. Is it legal not be forth-coming with the banks in not letting them know you intend to rent the home. I ask because every mortgage broker or bank completely changes the requirements as soon as I mention investment property. I like that conventional loans let you factor in the estimated rent into your approval decision but starting out I can't afford 15% down payments.
@James Williams You should be able to get a mortgage for a rental property. Which type of mortgage depends on your lender and if you will be living it in or not. You can get a mortgage requiring a lower down payment if you plan to live in it-usually for a year or two.
Yes, I know with FHA loan and some other loans it is required that you live there for at least a year and to lie about that is fraud. I was more talking about mortgages without the requirement that you live there for a year. I haven't had much success talking to mortgage broker about it because as soon as I mentioned renting out the property or investment property they change the entire conversation to conventional loans like I no longer qualify for a regular mortgage.