Low DP (5%-10%) owner occupied mortgage on rented property?

3 Replies


We are looking to rent our current home, buy a new place and use it as our primary residence. I came across a house that has tenants under a lease until April. Will I still be able to qualify for the same mortgage terms I get if I move into an empty house? I intend to move in once vacant.

Your advice is greatly appreciated!


@Ariel Li It can definitely be an issue. Fannie/Freddie, owner occupied loans include an occupancy disclosure that states you will occupy the property within 60 days. The first issue is that you probably cannot comply with that. The second and probably biggest issue with loan approval is that most underwriter's will spot that the property is leased out for another eight months and will stop the loan from going through as an owner occupied loan. 

Many areas have strict tenant rights laws. Not sure about Massachusetts but maybe ask if the seller can send a notification to vacate the property within 60 days. Not sure whatsoever if that is something that can be done but maybe worth asking.