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Posted by KENNY on June 16, 2000 at 18:13:23:

In Reply to: Re: Don't do it. posted by Melissa on June 13, 2000 at 09:08:06:

There is a big difference between applying for a mortgage as owner-occupied(meaning the owner intends to make this his/her primary residence) and applying for a mortage as non-owner occupied. First, the amount of money that the lender will loan you towards the purchase of a property decreases from 95-100% of the purchase price, to about 70-80% of the purchase price. Example property costs $100k....if you intend to live there you could possibly get all $100K financed....if not you may only actually get 70 to 80k financed. I have not met a lender in the entire U.S. that will lend at 100% ltv(loan-to-value)on non-owner occupied property. Second your individual income must be able to sustain the mortgage payment and your rental payment AT the time of application. This stipulation is different only if you already own the property. I that case you would be allowed to add in rental income that you receive. Third, Home Owner Insurance, there will be an increase in premium whether your insurance is escrowed or not due to increased liability since the owner will not be living in the property so be ready for this. Last, the type of property; this will have a dramatic effect on the lendable amount. Condos, manufactored homes, single and double wide trailers on foundation, rural properties....all of theses carry decreased lendable amounts...meaning you might not even get close to getting the amount you need finance it in the first place.

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• So in other words, Don't do it! John 06/17/00 (0)

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: There is a big difference between applying for a mortgage as owner-occupied(meaning the owner intends to make this his/her primary residence) and applying for a mortage as non-owner occupied. First, the amount of money that the lender will loan you towards the purchase of a property decreases from 95-100% of the purchase price, to about 70-80% of the purchase price. Example property costs $100k....if you intend to live there you could possibly get all $100K financed....if not you may only actually get 70 to 80k financed. I have not met a lender in the entire U.S. that will lend at 100% ltv(loan-to-value)on non-owner occupied property. Second your individual income must be able to sustain the mortgage payment and your rental payment AT the time of application. This stipulation is different only if you already own the property. I that case you would be allowed to add in rental income that you receive. Third, Home Owner Insurance, there will be an increase in premium whether your insurance is escrowed or not due to increased liability since the owner will not be living in the property so be ready for this. Last, the type of property; this will have a dramatic effect on the lendable amount. Condos, manufactored homes, single and double wide trailers on foundation, rural properties....all of theses carry decreased lendable amounts...meaning you might not even get close to getting the amount you need finance it in the first place.


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