Is it mandatory to live in the property when house hacking

Member since 2023 · 43 posts · 10 votes

Let’s say i get a loan from the bank to house hack, is it actually mandatory for me to live in the property or can i just lie to the bank and rent out all the rooms and continue living at home or is this not allowed when house hacking, I’m just getting started so I’m not sure if I’m asking a dumb question to most of you who are more experienced.

1 Reply

29 views

Most Popular Reply

Andrew PostellPro Member

Lender · Fort Worth, TX · Member since 2016 · 8k+ posts · 6k+ votes

@Ismail Sogbaike hey, it's ok here. If you don't know, then you don't know. To purchase a home with a Primary Home loan, the requirement is to occupy the property. However, you only have to occupy the property for 12 months. So, it's not long of a time period. Plenty of people out there who just purchase a home, live in it for 1 year, then go purchase another primary home. But you do have to occupy.

2 Reply

See this reply in the discussion

12 Replies

Jump to latestLatest

Sort by

Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
3y
If you say you are living in the house and putting 5% down and don't live there, it is mortgage fraud and you can get in a lot of trouble. Those loans require you to have the home as your primary residence.
1 Reply
Jonathan Taylor SmithBusiness Member
Rental Property Investor · Durham / Raleigh (Triangle), NC · Member since 2015 · 840 posts · 801 votes
3y
Are you asking if it is ok to commit mortgage fraud?
Blue Chariot Realty & Management4.915 Reviews
Website View Page
0 Reply
Ismail Sogbaike
OP
Member since 2023 · 43 posts · 10 votes
3y
Quote from @Jonathan Taylor Smith:

Are you asking if it is ok to commit mortgage fraud?

No, I’m 3 really new to this game and was unsure with the things you could and could not do.
0 Reply
Matt Devincenzo
Investor · Clairemont, CA · Member since 2011 · 3k+ posts · 2k+ votes
3y
Let me ask you a question; would you ever feel ok with someone lying to you in order to get you to do something you otherwise wouldn't? And specifically if that 'thing' was to give them money...a lot of money...? So why is it even a possibility that you'd do that to someone else?
0 Reply
Andrew PostellPro Member
Lender · Fort Worth, TX · Member since 2016 · 8k+ posts · 6k+ votes
3y
@Ismail Sogbaike hey, it's ok here. If you don't know, then you don't know. To purchase a home with a Primary Home loan, the requirement is to occupy the property. However, you only have to occupy the property for 12 months. So, it's not long of a time period. Plenty of people out there who just purchase a home, live in it for 1 year, then go purchase another primary home. But you do have to occupy.
2 Reply
Jonathan Taylor SmithBusiness Member
Rental Property Investor · Durham / Raleigh (Triangle), NC · Member since 2015 · 840 posts · 801 votes
3y

No problem @Ismail Sogbaike - as you get into this, just make sure you always do what you say you're going to do. That will aid you in all sorts of ways, including eventually getting private lender funding for your deals. But to your original question, if you get an owner-occupant loan and actually plan to live in the home, and then some time into that, something happens to require a change of plans (legitimately) - then that is another matter that you can discuss with the lender at that point.
Blue Chariot Realty & Management4.915 Reviews
Website View Page
0 Reply
Rick Pozos
Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
3y
If you get a loan that says you are going to live there, live there. NOW you can always have 10 of your buddies paying YOU rent also. YOU just have to live there for at least the first year. It is your house, have 1 or 2 friends live there with you. That is a great way to keep costs down.
0 Reply
Brian Sparks
Member since 2023 · 6 posts · 2 votes
3y
Do all parties on the mortgage have to live in a property for the year? I am considering co-signing on a triplex property with my DD in college and having her live there. She would live rent free, I would get a property at a lower down payment, and the property would still cash flow with two units rented out. Since she would be a cosigner and not just another tenant, it would seem we met the requirement to live in the property - is this true or must we both live there? And as a dependent, would she even need to cosign?
0 Reply
Ryan ThomsonBusiness Member
Real Estate Agent · Colorado Springs, CO · Member since 2018 · 1k+ posts · 1k+ votes
3y
@Ismail Sogbaike you have to intend to move into the property within 60 days and intend to live in it for a year. If you never had any intention of doing that and your bank finds out and you aren't making payments, then you may get charged with Loan fraud.
The Assumable Guy544 Reviews
Website View Page
0 Reply
Benjamin Sulka
Cleveland, OH · Member since 2022 · 811 posts · 578 votes
3y
Ismail,
Yes, you do have to live in the property and you have to do so for at least a year.
There are instances that you can get out of it if particular life events occur (take marriage as an example) but you absolutely have to live there otherwise.
All the best!
0 Reply
Kevin Stewart
Columbus, OH · Member since 2019 · 3 posts · 0 votes
3y
Nice
0 Reply
Dominique Morris
Member since 2023 · 5 posts · 0 votes
3y
Depending on the mortgage type you used to purchase the property, some require it to be your actual residence, and typically, with this requirement, come tax breaks. If you're using an FHA loan, renting prior to residing in it for the designated time,it ou could be considered mortgage fraud. However, consider that with a 3.5% down payment, you can purchase up to a 4-unit property and rent out the other units while living in one of them. If you opt for a single-family home, you can also rent out individual rooms on Airbnb or through roommate websites.
0 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.