All Forum Posts by: Mike G.

Does this meetup still happen?

I would say if you can't split the utilities maybe you can make both units work as short term rentals, in which case, splitting utilities wouldn't matter. Run your numbers as it may work out better that way. It also gives the option of larger families being able to rent both units. But I think even if it was detached the only way you can add an ADU is if the property is owner occupied to begin with.

When you say "long term", as far as I know, the requirement is only that one lives there 1 year.

Yes, I am currently living in a purchased SFR and I would be moving into the Triplex.

My credit score and my financials are all good. I have the only offer in on the Triplex so its not related to competition. My mortgage broker said the issue is convincing the underwriter that I actually plan on moving into the Triplex from my SFR. He said the fact that I own a few other rental properties hurts me because an underwriter is not going to believe that I need to buy a Triplex for my primary residence when I live in a SFR and I own other rentals. I told him this seemed ridiculous that they wouldn't believe me. He said he has been in the business 30 years and this is his experience.

The only thing that makes sense is maybe he feels this is a lot more work for him to try and get this approved so he is trying to scare off the business.

I contacted my Mortgage Broker and told him I was interested in buying a Triplex with an FHA loan and living in one of the units and his response was good luck with that. He said I would have about 1% chance of getting approved for an owner occupied conventional loan and even less of a chance getting approved for owner occupied FHA loan. He said the underwriters will not approve this because I am moving from a SFR to a Triplex and I wont be able to prove "Occupancy." He said they will be putting their job on the line approving this and most likely will disapprove it and if they do approve it they will just kick it up to their boss who will disapprove it. He said once I have tried applying and getting disapproved I will not be able to apply again with a different lender because there will now be notes in my file saying that I was disapproved for "Occupancy" and I will just be disapproved again.

I have never heard of this being an issue. I could see if someone was not actually planning to move into the Triplex, this could be a problem but this is not the case. 

Does anyone have any insight on this, for me?

Its interesting, I too initially thought there was a "right way" to make sure your assets would be protected. However, the more I research and look at pros and cons the more I see its a situation of there being pros and cons either way. I would say do your homework on LLC vs no LLC so it works for you in your specific scenerio and investment strategy/goals. And know why you went that route, either way. Don't go off what one guy says, even if they're an "expert", or you found the info in "Rich Dads" book.

The Book on Investing in Real Estate with No and Low Money Down - Brandon Turner

The Millionaire Real Estate Investor - Gary Keller

As far as, if you should rent out your home, I dont think any body will be able to give you a real answer without seeing all the numbers. How much your house is worth, how much you pay monthly, what it can be rented for, etc...

Out of curiosity, are all those loans under your name only? Are you married? I had thought a spouse could also get a max of 10 loans, in their name, as well. Assuming you checked into this but I was curious.