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Buying a Secondary Home

I did a cash out refinance on my primary home back in July 2020. At first, I wanted to do some remodeling and invest in the stock market. Since the rates are still pretty good, I am actually thinking about upgrading my living situation and buying a second home to live in and rent out the first for income. Am I able to do this now or do I have to wait a year since I just refinanced 7 months ago. by mr.combat1742 from Porter Ranch, California. Jan 17th 2021 Reply

Bert Carpenter (BertCarpenter)
#1 ranked lender in Arizona - 2,336 contributions

Go for it. The risk of fraud is, in my opinion, negligible. Fraud is determined by intent. At the time you refinanced your primary residence, it was to obtain funds to allow you to do some remodeling and make investments. In exchange for preferential pricing, you committed to continue living in the home for the foreseeable future, which is generally interpreted as 'at least one year'. Some seven month later, after changes in the real estate market, you have decided that investing in another real estate property is a better risk than investing in the stock market. The market changes you are seeing justify your decision. As long as you don't let either home go into default, I see no one having an issue with your change of plans, and even if you did go into default, it is not likely they could make a case that your intent at the time you refinanced was anything other than honorable. So, Go for it. As a California native with a California Mortgage Originator license, I'd be happy to help. Just give me a call. ~ Bert Carpenter, The LoansA2z Team of NEXA Mortgage ~ NMLS 40586 ~ At NEXA, we've got you covered. We are licensed in all states except MA and NY and we are pending approval in VA, so give us a call. ~ 480-889-9000.

Jan 18th 2021
Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 4,535 contributions

You are fine... When you did the last loan, you got the awesome 'owner-occupied' loan low interest rates, and you signed paperwork saying you would live in the home at least one year. As rental property mortgage rates are higher, people are always trying to say a rental property is their primary property to get the better deal. This is mortgage fraud. But, it is really all about intent. If you have no intention of doing this back then, and now you do, the lender may ask a few questions, but you should be fine. I lend in MN WI IA SD ND. Find me at - Cambria Mortgage, the Joe Metzler team, NMLS 274132

Jan 19th 2021
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