BDRICH71 0 Report post Posted September 23, 2004 Just a quick question.. probably an easy question too. What if the seller has an owner occupied loan, which they most likely will, and we do the lease option thing and find a tenant/buyer for the home. Couldn't the lender potentially call the loan due if they found out the seller was renting the home out? Brian Share this post Link to post Share on other sites
grannyguru 0 Report post Posted September 23, 2004 Answer: NO! .......................................................................................................................Your scenario would ONLY apply if the seller had just recently purchased the home, claiming to be going to occupy it. These things are spelled out in the contracts the seller signed when taking out his loan on the property. IF someone takes out a loan as owner-occupant and then almost right away turns around and rents the place out, then the seller could have problems. IF the seller lied about planning to occupy the property, then the seller is guilty of loan fraud. But again: these things are made clear in the loan contracts. Translation: it is NOT a big, scary thing with sharks out there ready to attack at the least slip. It's quite common for people to buy a home and then later decide to move somewhere else and rent out the old home. Lenders don't care as long as they are paid and the seller hasn't committed loan fraud. If the loan specified the home could NEVER be rented out, then the seller would simply have to refinance. But I doubt you will ever run into that situation and the seller would definitely be aware of it long ago. Hope that helps, Alice Share this post Link to post Share on other sites
MichaelC 160 Report post Posted September 23, 2004 Brian, as Alice said. This is rarely an issue, unless a homeowner is intentionally committing loan fraud. That is, applying for an owner occupied loan to obtain a better rate, knowing that their intention is to lease the property. And, if that were the case, and the lender were to find out, that becomes the headache and responsibility of the homeowner. Not you, and not the tenant/buyer. Share this post Link to post Share on other sites
BDRICH71 0 Report post Posted September 23, 2004 Ok, thanks for the answers!Everyday's a school day! Brian Share this post Link to post Share on other sites
