Making 1st Home to a Rental and Buying a New Principal Residence

[Cody Weber]

Need some advice on a scenario I am working on. If I purchased my first home for 5% down - 275k @ 2.4% for example sake... what happens if in year 2 of my five year fixed mortgage I am looking to move to a new principal residence with my spouse?

I would deem the first as a rental as I’d be living in the new principal residence with my spouse. That wouldn’t affect the mortgage term on the first property until I refinance in year 5, right?

Furthermore, would I be able to put 5% down on the new principal residence?

My motivation is scalability but I can see how lenders would be hesitant as I have little skin in the game. Thanks in advance!