When can I convert primary residence to AirBNB?

Question

Purchased a primary residence home in August 2022. We are eager to begin using this property as a long term (3 months at a time) or a short term rental. What are my options for when I could begin renting out this property?

Lien Vuong · Answer

You still need to maintain residency for 1 year but you can rent some bedrooms out to MTR/STR platforms.

Levi Bennett · Answer

Totally depends on the loan product you used to acquire the loan, so you're first call should be to the mortgage lender who did your loan. It's all in your lending contract. Many conventional loans will allow you to do it right away, but again.. it depends on your personal situation. An experienced realtor in STRs will be able to tell you what questions to ask your lender before closing. Also, it usually makes a difference if you're renting out your entire property or just a portion of it (like a room or a guest suite), normally you can do this right away assuming that your local government allows this (municipality, county, HOA, etc..) and there are no deed restrictions prohibiting it.

Dominick Johnson · Answer

Typically 1 year. Technically nothing is stopping you from renting it out the day after you close, but that's a personal risk/ethical decision you can make.

Andrew Steffens · Answer

Hey Matt - Im not a lending professional but have some experience in this.  Did you purchase it with a FHA, Conventional, VA or other loan?

Account Closed · Answer

Depends on local guidelines as well as the terms of the financing behind the house. I would ask your lender more about this.

Zane Cress · Answer

After 183 days you round up to the 1 year mark is what I have been told. Unless you need to use another FHA loan to move it shouldn't matter for your next loan. If you don't plan on moving or you don't need the strict lending products you can do what you want. Highly unlikely the lender comes knocking on your door to make sure you are home and not renting out the place you bought.

I would focus on MTR, once you rent for 30+ days at a time then the cities can't enforce STR laws on you. You can do this through Furnished Finder to connect with tenants. Airbnb also has a 30 day minimum stay option you can turn on.

Dominick Johnson · Answer

I stated the facts...it was not advice. Truth is the chances of a mortgage lender suing someone because they are renting out their house is not very likely, they are more concerned with the loan being paid. As I mentioned though, it is an ethical decision and risk the OP can make.

Anthony Angotti · Answer

Committing mortgage fraud would be a pretty big thing stopping them, but I guess if something that can carry severe legal punishment up to felony isn't stopping them then by all means. . . .

Anthony Angotti · Answer

You have to look at your loan paperwork. Many of them have "no hoteling" clauses that would prevent you from doing this. Same goes for your insurance policy.

For insurance I'd call your agent. I'm sure they will be more than happy to sell you something additional.

For your loan you should just brew a nice pot of Joe and give it a look. If you did it with an FHA loan then you will likely need to refi out of it because I know that they contain no hoteling clauses.

Michael Baum · Answer

Hey @Matt Willison, like others have said, it will depend on the mortgage you used.

If you bought it as a primary home, then I am guessing you used a conventional mortgage or and FHA for a residence.

A conventional mortgage might have a clause about not renting the property at all. As long as that lender holds the mortgage, you can't actually rent it. That would be mortgage fraud and it could be a problem. Not all mortgages have that clause, but I would say 95% do.

If it is FHA, you must live in the house for one year before you can vacate and rent it out. FHA is very strict about this and they do check. As long as the mortgage is with FHA, you will most likely not be able to obtain another FHA mortgage. There are restrictions.

When can I convert primary residence to AirBNB?

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