Why does Fannie Mae require owner occupancy?

Fannie Mae has owner occupancy requirements in place for some of the homes it sells to encourage homeowners to buy the properties before investors. Occupancy rules usually apply to homes during at least the first two weeks of the initial listing, before non-occupant investors can have their bids considered.

Is owner occupancy required for conventional loans?

Owner-Occupancy Periods Federal Housing Administration lending guidelines require homes bought with its insured mortgages to be owner-occupied.

How does Fannie Mae check owner occupancy?

You have to sign an addendum stating that you are going to occupy the property within 60 days and reside there as your primary residence for at least one calendar year, OR pay a penalty of $10,000 (or something very similar, see example contract.) They will check.

Do mortgage companies check owner occupied?

Why do mortgage companies verify occupancy? Mortgage companies will verify occupancy because mortgage fraud is a fairly common practice for those looking to avoid the high interest rates of investment properties. Moreover, occupancy can affect the appraised value of the property.

How do you qualify as owner occupier?

Generally, for a property to be owner-occupied, the owner must move into the residence within 60 days of closing and live there for at least one year. Buyers purchasing property in the name of a trust, as a vacation or second home, or as the part-time home or for a child or relative do not qualify as owner-occupants.

How does HUD know if you owner occupant?

How does HUD define owner-occupied? The only way a buyer can be considered an owner-occupant is if the person living in the home will be on the deed when HUD sells the home. That occupant has to live in the home for at least a year and cannot buy any more HUD homes as an owner occupant in that first year.

What is intent to occupy?

Generally, the terms of the mortgage or deed of trust state that it is your “intention” to occupy the property as a primary residence for at least 12 months (if there is an investment or second home rider to the mortgage/deed of trust, no worries).

What happens if you don’t live in your FHA home?

Can I get an FHA loan for a home that I do not plan to personally live in? No. FHA loans are made available to homeowners who plan to occupy the property as their primary residence – and you will be required to sign an “Occupancy Affidavit” that you will in fact occupy the property for a minimum of three years.

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