Refinance Two Properties Owner Occupied Back-to-Back?

Question

I refinanced a property owner-occupied conventional in February, then COVID hit, and I had to move into one of my rental properties.  Now that I am living in my rental for the forseeable future, can I refinance this property owner-occupied conventional too?  I'd like to do it right away, as it would not only drop my rate, but allow me to miss a couple payments and increase cash flow during this crazy time.

Bill B. · Answer

Did you sell the first refinanced property? The one you promised to live in for at least a year? If so, I don’t see a problem. You certainly wouldn’t want to come up on the credit report of the first lender with a new Mailing address and new owner occupied loan. If you didn’t sell, and aren’t breaking the law, I would tell the first lender in writing, preferably certified mail. I’d rather have them change my financing terms than try to have me prosecuted for mortgage fraud. Even winning that case would cost more in legal fees than you could possibly save.

There’s such a permanent record you could think you “got away” with it for years before you suddenly got that lawyer letter. Again, if you don’t think you’re doing anything shady, tell the first lender. Then they can’t after you later.

Anton F. · Answer

@Philip Lindholm

Hi Philip, I see, thanks for the prompt reply! I assume it wasn't a major issue then? Did you have to inform or get permission from the lender/bank for your original refi loan?

Anton F. · Answer

I find myself in a similar predicament! Moved back into a rental after completing a refi on my OO property. Were you able to do it and did you run into any issues?

Philip Lindholm · Answer

@Anton Finko

Hey Anton, my experience was it is less about timelines and more about circumstances.  If there’s a life changing event, you can refi sooner rather than later.  Good luck!

Philip Lindholm · Answer

I plan to use a different lender, and therefore a different bank.  Wonder if that would fly?

Brie Schmidt · Answer

Bank I use will require 6 payments on the old place before letting you refi a new one as OO