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Why is my condo now an investment property?

I own a condo in DC and moved 5 months to Europe to work for the Department of State.  Our housing in Europe is free (well, the government pays for it), and I rented our condo.  I am trying to refinance, but many lenders say I now have an investment property.  Well, I rented if out as it made no sense to leave it vacant while I am in Euorpe, but when I return in 2 years, we will move back into our condo.  Is this something we are stuck with for two years - investment property category - and when we return it goes back to being a primary residence?
  • March 31 2012 - U Street Corridor
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Answers (4)

Yes, it will be cconsidered an investment property until you move back in and prove it to be a primary home again.
  • March 31 2012
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If your current mortgage was taken out prior to 5/31/09 and it is owned by Fannie Mae, Freddie Mac or FHA you can qualify for the HARP Program or an FHA streamline even with the house being an investment property.

The HARP Program institutes a cap on the rate/price of the mortgage that keeps the rate very close to primary residence rates.  The FHA streamline does not distinguish between primary and investment for purposes of a streamline.

If you took the loan out after 5/31/09 and it is an FHA loan you are still potentially eligible for a streamline however the MI will likely go up and it may make it more difficult to qualify for the streamline.

You have a lot of moving parts and you need to provide more information to get a better response.  Let me know if you have any other questions or if you can provide more information.
  • May 12 2012
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The HARP Program institutes a cap on the rate/price of the mortgage that keeps the rate very close to primary residence rates. 
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the cap doesn't apply to investment properties.
  • May 12 2012
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Norm. 

Please see Fannie Mae release dated 12/20/11.  Page 2 Table 2.  Look at the cap for non-primary residences.  The cap is 2% for loans with 25-30 year terms. 

I have also closed 4 this month with a cap of 2%.  I would be glad to discuss this with you if you would like.

Best Wishes,

John
  • May 12 2012
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