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Profile picture for EliCitron

Must Refi, Not a Rental, I Live out of State

I currently own a home in Omaha that I bought in 2007, but I've recently moved to WA state.  Only after moving across the country and giving my lender my updated mailing address, did I learn that, according to my mortgage terms, my house MUST be owner occupied.  The only way to keep the US Bank dogs at bay has been to have my house on the market.  After 11 months and zero offers, the only other option I have seems to be a refi, so I can own in Omaha, yet live elsewhere.

Over the phone, an employee from the US Bank mortgage dept. informed me that "almost all" conventional mortgages require owner occupancy and that my only other options were to get second home mortgage or a rental mortgage.  I don't want to get a rental mortgage, as I plan on moving back in a few years.  Additionally, I wonder if someone who would still only have one mortgage (I rent in my new city) could actually qualify for something referred to as a second home mortgage, as I don't know it's the word "home" or the word "mortgage" that the second refers to.

Value of home 140K, loan remainder 106,743, currently at 6.04%, good credit.

Are there conventional mortgages that exist for me and my situation?  I'm stumped and not sure if I want to go to shopping lender after lender, potentially hurting my credit, if I'm not even sure  of my options.  Any advice is much appreciated.

  • September 02 2010 - Omaha
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Answers (10)

I was not simply throwing out an editorial comment.  I wanted to make sure I had the whole story before giving advise.  You are not going to be able to get any deal done until you nail down a consistant income source.

That could have been a bigger issue with US bank than the occupancy.
  • September 22 2010
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Profile picture for daveskow
thanks for the update....after securing the  new employment  try the  second home refi strategy with a new lender  ( preferably one thats local to the subject property )
  • September 21 2010
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Profile picture for EliCitron
Dave, no I've not started the process yet, unless you count actively looking for a job so I can qualify for a loan at all.  I asked a bit about that here: http://www.zillow.com/advice-thread/Type-of-Income-History-Needed-to-Qualify-for-Refi/367070/ 

Which brings me to Timothy.  Are you referring to specific penalties or fees or are you simply tossing out an editorial comment?  I'm well acquainted with the headache of my situation, thank you very much. 
  • September 21 2010
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Are you the same person that previously left your job and became self employed?

I just read that scenario this morning.  If that is the case, you may have more issues than occupancy.
  • September 21 2010
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Profile picture for daveskow

so have you tried to  begin a new refinance  for the property  classifying it  as a 2nd home  yet?

  • September 20 2010
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Profile picture for EliCitron
Wayne, US Banks DOES see it as a problem despite the fact that I lived in the home for over 2 years and have instructed me that I MUST refi OR sell.

Wetdawgs, yes, the home is unoccupied.

Dave, my how I hope you're correct!  :)
  • September 20 2010
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I think I have heard other stories of US Bank being...jerks.

Call a number of banks to see if they have a loan product to help you, large national and smaller local banks.  Whatever loan product you need, you will probably find someone more willing to be helpful at a smaller bank.
  • September 17 2010
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You did occupy the home so that should not be an issue. If your plans changed and you moved to another area/new job, that would not create an occupancy issue regarding the mortgage terms. You obviously lived in the property for more than 12 months, if you moved out in the past year.
Refinancing the house as a second home would not be ideal if you don't really plan or want to use the house as a second home. Paying two mortgage payments with no rental income would only make sense if you could afford expenses and really used the second home frequently. A better option would be to consider renting the Omaha home. This creates risk as far as tenant selection, rent loss, repairs, etc. so selling the house at a rock bottom price would need to be compared. Renting the Omaha property could create requirement that would need to be met if you wanted to buy a house in WA i.e. reserve requirements, qualifying without counting rental income etc.
Bottom line is to get referred to a loan officer that would be able to evaluate your scenario. They could get input from your Realtor in Omaha if they needed to know rental potential and rental range.
  • September 03 2010
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Profile picture for wetdawgs
For clarification, is the home in Omaha unoccupied except for when you visit?

Welcome to WA

  • September 02 2010
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Profile picture for daveskow
 assuming the  home is NOT ( or has not been )  rented at all - you will want to classify the property  as a " second home "  ( aka vacation home ) and  simply as a lender to complete a  simple  refinance  on this  " 2nd home " ..rates should be the same as  " primary  residence "  rates
  • September 02 2010
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