Owner Occupied VS Non Owner Occupied

[b][/b] Hello there. I have a question out there for all you mortgage gurus! And you know who you are. :slight_smile: Would a lender actually ever find out if the property that they are lending money on is owner occupied or not? I overheard someone at my real estate investing club talking about this, and I am just curious.
Also, another question for you mortgage gurus, how did you learn to become a mortgage broker? And where could one learn learn what they need to learn to become one?

Thanks guys!

Ah yes…the old," let’s sneek it by the lender " question.

If you currently have a mortgage (Owner Occupied)and you are going to purchase another property (Investment) in an area that is not a “resort” area. It is going to be a little difficult to convince the lender that it is going to be for your “primary or second home” use.

If you are successful at convincing them then you can probably get approved, based on your parameters.

Theoretically, once you are approved you will probably never have anyone from the lender stop by to verify that it is your primary home.

However, should you get caught the Lender can call the note and require immediate satisfaction of the loan.

I would strongly suggest that you think about the minimal savings that will be achieved with the level of risk.

Mark is right here…The lender is going to know that you are currently living somewhere right now (whether you own the property or are jsut renting). Not only is this required for the app. obviously, but all of your previous and current addresses show up on the credit reports that we pull. So, it reeeally has to make sense as to why you’re moving: new job, need a bigger house, etc. And as Mark noted if you are buying a property that is not “resort” type location it will almost assuredly be considered an inv. property. ESPECIALLY, if you buy a multi-family. Likely the lender would have no way of knowing, but if you do get caught you’ve just committed fraud. Then you’re stuck proving that it was not your intention for the property to be a rental in the first place, which it really was. As for the mortgage broker side of your ?, I have learned lots and lots over the past few years working for a great mortgage company. There are so many ins and outs of this business it’s hard to get the knowledge without the experience. I am sure there are some great books out there, I wouldn’t be able to recommend any as I get my knowlege from my job and real life experience with clients-sorry on that one. Maybe someone who reads this post could make some recommendations though…You can never have too much knowledge, especially when dealing with something as substantial as a mortgage! Best of luck to you!

Some lenders are actually starting to check. Granted the odds of getting caught are about 1 in 500, but I would hate to be that one.
Play fair.

I really don’t care if there is a chance of getting caught or not, I won’t do it because it’s DISHONEST and WRONG!!! Where is the integrity? When I went to military schools there was a code to live by: “I will not lie, cheat, or steal nor tolerate those that do”!


Keith, your not one to mince words huh? lol
I guess military school made you one tough s.o.b.

No, actually, the military schools were kinda wimpy – my dad is German and his father before him. Basic training was like working for my dad but the drill sergeants didn’t yell as much. My father claims that until he was 14 and found a copy of his birth certificate, he thought his name was “Mach Schnell” because that’s what his father always said to him…I actually started working in the woods helping my dad logging when I was 7 (true story). I was brought up to work hard and be honest.

People that get over at other’s expense really burn a canyon in my @$$!

Sometimes you gotta say what you gotta say!


Ok. Thanks for all your input guys. Really appreesh!
Good for you, Keith, that you are one honest s.o.b.! The world def needs more folks like you around. That’s fo sho!