I am new to BiggerPockets and a newbie looking to investing into real estate. So here is my situation, I bought my primary residence house in the beginning of 2021. It's almost 2600 sq foot and I am currently single and mostly Work From Home, I think the house is too big for me right now. I am considering renting the house out, will I need to ask my mortgage company to allow me to do this? Any thoughts or suggestions would be really helpful
Real Estate Agent · Skagit Valley, WA · Member since 2021 · 256 posts · 283 votes
4y
@Nithin George You'll probably want to leave your mortgage as it is - since at the beginning of 2021 when you purchased the home you most likely got a decent interest rate. And if you refinance for any reason, the interest rates are usually higher for investment properties.However, you WILL want to contact your insurance company and make sure that you change your policy from a primary home policy to a rental home policy.
Real Estate Agent · Skagit Valley, WA · Member since 2021 · 256 posts · 283 votes
4y
@Nithin George You'll probably want to leave your mortgage as it is - since at the beginning of 2021 when you purchased the home you most likely got a decent interest rate. And if you refinance for any reason, the interest rates are usually higher for investment properties.However, you WILL want to contact your insurance company and make sure that you change your policy from a primary home policy to a rental home policy.
Lender · Nationwide Lender · Member since 2019 · 391 posts · 140 votes
4y
If you have a conventional loan, there is no issues. If you have an FHA loan you still are fine to do so because you have been in the home for a year now. That is the requirement for an FHA loan. You don't need to switch the loan to an investment property, it can stay the way it is. I assume your interest rate is in the 3's or lower?
Insurance Agent · Norwalk, CT · Member since 2016 · 2k+ posts · 1k+ votes
4y
Nithin,
If you are talking about renting just a portion of the house and living there your current homeowners policy may need to be endorsed (depends on the company - check with your agent)
If you will no longer be occupying the house when you rent it out, it is likely that you will need to change from the current homeowners policy. We represent dozens of Homeowners carriers and most would require that the policy be cancelled and coverage written on a Dwelling/Fire form (again, check with your agent)
@David Kelly Yes my interest is like very low 2.5 but it is a 15 year. But still I hate to refinance to investment. As it would increase the interest rate. Thanks for reply.