is there a way around owner-occupied status?

Hello. I’m looking to get into my second investment property. I used to live in my first property so my interest rates are great and it really helps my cash flow. However, on this second property I am getting hammered by increased margins and/or points. I was told if it was owner-occupied then I could be given “normal” home-owner rates.

So my question is, what’s to stop me from lying and say my wife and I are separating (or even divorcing) and I plan to live in the property? How does the bank know? What does the bank need if anything to confirm if it is owner-occupied when I already own a primary residence now? Just curious. I’m not saying I would actually do this. :wink:

By the way, I heard a story about a couple that used to get divorced every single year before the end of the year to save on their taxes. So my idea can’t be that crazy, can it! Thanks.

Howdy DCguy:

The old saying to justify doing something like this is that everybody does it and no one gets caught or hurt. Nobody ever checks either. I stayed one night in jail and will never do anything ever again to even get close to getting free room and board again. Pay the extra rate and whatever else it takes to get the deal. Not that you were going to do it but it is tempting and easy to do if you want to do it. I have seen fake leases on your real property and utilities turned on in the buyers name for the tenants etc. A scam is a scam

Lieing is not worth it. i agree with Tedjr - dishonesty may work in the short term. You want to build a credible presence in your market and create long-term relationships with banks, brokers, clients, etc. Lying will not help you be successful in that area.

As a loan officer I can see right thru this scam. Most people do not move from a very nice home to a lessor home without a good reason. I f you claim you are splitting up or the big D the bank or investor is going to want paper work on it. Do the right thing pay the rate, points and margin and take the tax write off

Duly noted!

Forget about the broker or loan officer they just want to make a sale and if they aren’t on the up and up there underwriter will surely catch it which could hold up and blow your deal out of the water. It’s not worth the risk read your 1003 app carefully this is a legal and binding DOC and it will bite you in the back side for lying.

Mortgages, costa - glad to see your posts. Ethics will always ultimately benefit the individual and the industry