Coming back to you with more information on condominiums.
Let’s talk about second home condos.
What the heck is a second home condo?
A second home condo is considered as something that
you don’t sleep in and live at all the time,
nor is it something you intend to rent out.
Here in Florida we’ve got a lot of snowbirds.
You live up north for most of the year or whatever,
you come down here for a few months to avoid the cold.
That is a second home condo.
Some people call them vacation homes.
And again this isn’t specific to condos
Here is something for you to know.
There are a lot of confusion, people would sometimes
buy a condo as a second home.
And they’ll structure their financing that way,
but then they will really intend to rent it out
And this is where it starts to get tricky.
Let me give you the definition of a second home
per Fannie Mae standards.
“The property must remain in the exclusive use
and control of the borrower, at all times”
So, literally if you put a tenant in there for a day.
It technically violates that rule,
violating that rule can be construed as mortgage fraud.
You’ve got to be careful with that.
If you intend to put a tenant in there,
You’ve got to do it as an investment property condo.
Your rates maybe a 1/4% higher,
and your down payment is a little bit bigger.
But it is not worth breaking any rules over.
I find sometimes, people break rules,
not knowing they are doing them.
And ignorance is no excuse in breaking the law, we’ve all heard that.
So that’s the deal. Look,
if you are on the fence about things, let me know.
One other thing to mention now that I think about it…is
“So Scott, what if I bought a second home,
and years down the road, I decided at that point,
to put a tenant in there?”
That is probably fine, it’s case by case specific
Reach out to me so I can talk to you about it.
It would really has to do with your intention
on the front end.
Anyway, any questions, reach out to me
I’m Scott DiGregorio, I’m Your Mortgage Guy
I’ll see you at the next video, take care.