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Going Expat before closing a new construction

I'm currently constructing a house in Canton, MI. I have a sold steady job, perfect credit score, so I got pre-approved and the construction began few months ago. The house will be completed in early October. Few weeks ago, my wife and I accepted a job in Qatar that is temporarily in nature but may last a year. The employer is foreign university. I haven't resigned from my US job yet. I'm getting conflicting reports that the house in the US will not be considered my primarily residence house. I do not understand why not. I do NOT plan to rent it and I plan to occupy when I return home in the summer (~3 months). I'm a US citizen and I will have no house in Qatar and I will not be renting either (university residence provided for visiting professors). I already put down 10% so backing off may mean losing my down payment. Do I need to be worried? I heard a) I may not get the load because lenders won't consider this my primarily house when they verify my employment has changed to a foreign country AND/OR b) lenders may require 2 years pay history in the foreign country and I obviously won't last there that long. What are my options? by aalkeilani from Canton, Michigan. Jul 18th 2013 Reply


William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,659 contributions

You have many things going on here.. first, your primary residence is the place where you spend the most amount of time living at within a year. Whether you own the room you live in or not has no bearing on what's primary or secondary, so if you live at your parents home for 7 months out of the year, and you live in your own home for the rest of the year, your parents home would be your primary residence.. however, your scenario is different.. when you purchase a home as your primary residence, you must move into the home within 90 days of closing.. if you cannot do that, then you have to purchase the home as either a 2nd home or an investment.. So you can still claim this as a 2nd home or investment and complete the transaction, however there is another problem.. Your employment.. Since your changing jobs, and going to a foreign country, the lender can deny the loan since your now subject to guidelines regarding the foreign employment.. I advise folks all the time.. don't do a construction loan unless you have the ability to pay cash for the home once it's complete.. a lot can change in the 6 months to 1 year while the home is being built.. people change jobs or get laid off or fired, people get sick or hurt and some times die... etc... in your scenario, you put 10% down, and now you stand to loose it if you cannot fulfill your contractual obligation to finish paying for the new home. You really need to sit down with your mortgage guy and explain to him your complete scenario.. with all the necessary information, he should be able to give you the right information you will need to make your decisions.. .. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Jul 18th 2013
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I'm checking with underwriting on this for you so I can make sure you get the correct information and will follow up with you. Jack Cyrul 734-395-9027 Dependable Mortgage, Inc. Brighton MI

Jul 18th 2013
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Mike Silkworth (msilkw_195_870)
#31 ranked lender in Michigan - 527 contributions

I'm assuming this opportunity presented itself after you entered into a Construction Contract and Construction loan agreement. I think you should be worried Taking the job drastically changes your employment and living situation from when you made initial application. You need to be talking to your lender and make sure the choice you make on the employment doesn't change your ability for a final approval. Good Luck.

Jul 18th 2013
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Michelle Curtis Loan Originator NMLS 401173 (EmbassyFundingLLC)
#77 ranked lender in Florida - 2,240 contributions

You need to reach out to your current lender and find out their guidelines on this.

Jul 18th 2013
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Dave Metsker (DaveMetsker)
#37 ranked lender in Oregon - 2,317 contributions

Talk to your lender. Perhaps, delay the conversion to a permanent loan until you return, at which time you can verify your occupancy by signing the loan documents locally, and verify employment within driving distance of your residence.

Jul 18th 2013
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Correct - the opportunity presented itself after entering the construction contract. The biggest factor in deciding to accept the offer is in fact making twice as much as I make in my current job given both my wife and I will be working.

Jul 18th 2013
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Michelle Curtis Loan Originator NMLS 401173 (EmbassyFundingLLC)
#77 ranked lender in Florida - 2,240 contributions

These are some important questions to know.Are you signing a contract? For how long? Is your job back here guaranteed when you come back? Is it in writing?

Jul 18th 2013
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Mike Silkworth (msilkw_195_870)
#31 ranked lender in Michigan - 527 contributions

Your current Lender is going to be the most motivated to help you through this, as they are on the hook also. There are two issues as I see it. 1) Occupancy of the home - this is the least problematic of the two. You may need to change loan type to a Second Home (likely OK and the best option) or to an Investment. This will likely not give you terms as good as what you have, but you'll be making twice the money. 2) Can your new income be considered since it is a new job and from a Foreign State. If your lender has the ability to hold the loan rather than sell it, then you have much more hope. Before you make any decisions, I'd consult an attorney to see what you are on the hook for if you can't perform on closing the loan.

Jul 18th 2013
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Steven Cook (stcookmortgage@gmail.com)
#38 ranked lender in Washington - 256 contributions

As noted before, the construction lender working with you on this should have the most interest in helping you get this to completion.If they are not willing to work with you (as many banks may not) you should contact a local, licensed mortgage professional who is willing towork with you to resolve these issues. The item of making this a "second home" should not be a big issue, as you should have more than sufficient equity, between the down paymentand the value increase of construction to take care of the LTV requirement. A good loan officer, should be able to work with you, and with yourfirst 30 days income from your new employment (and copy of employment agreement) to work out the other items.

Jul 18th 2013
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James Mazzola (Mazzola)
#110 ranked lender in New Jersey - 313 contributions

You might have a problem. Most loan require you to occupy you primary residence loan with in 14 days. Secondly all of you credit information will have to be re verified prior to closing. This can be a major problem. You might have to decide between the house of the new job???

Jul 19th 2013
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To clarify , I have no lender yet. A loan officer pre-approved me and I put down 10%. Hypothetically what would happen of a person run through this AFTER closing? Are they required to maintain their primary home status while there is an outstanding primary loan??I will try talking to the builder to get out of this with no penalty (but why would he agree?)

Jul 19th 2013
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Jack Cyrul (Jack Cyrul)
#5 ranked lender in Michigan - 94 contributions

What you are stating is the truth. You will have great difficulty gettingapproved as this home will not be considered your primary residence sinceyou clearly have no interest in living in it. Residence requiresinhabitation which you will be doing in Qatar, not this house that is beingbuilt. We have nothing to offer for this issue. Freddie and Fannie willboth look upon this the same way. Both would be checking post the loanclosing to verify residency. If they were to find the home is not beingresided in, the loan will be called due immediately in full.

Jul 19th 2013
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