Mortgage insurance on rental
Hi, I recently decided to refinance my primary residence in an effort to lower the mortgage payment to then rent it out and in this way increase my cashflow from it. I was working with a loan breaker and when the loan was completed I notice that he ran the refinance as if the house was still going to be my primary residence instead of investment property. So now my question here is what to do with the insurance, I'm afraid of going to the bank and explain the situation (basically explain that the property is now a rental) because I dont know what can they say about the loan itself. So my question is, can I just add renter insurance on top of house insurance? should I just go back to the bank, explain the issue and deal with the consecuences? I'm looking for some recommendations. Many thanks
Most Popular Reply
You need to get in contact with your broker ASAP. If this is an owner occupant refinance (either because you didn't mention the rental part or they processed it wrong) you may have signed a clause that states that you intend to live in the current property for at least one year. If you move out now, that's mortgage fraud.