Home Buying in Fremont>Question Details

encdeb, Home Buyer in Fremont, CA

Buying a home while abroad, primary home, but due to job abroad cannot occupy it more than 30 days a year.

Asked by encdeb, Fremont, CA Sat May 4, 2013

I'm purchasing a home while abroad which will be my primary home. I will have a relative occupy the property. The loan officer first wanted the mortgage to be a secondary home loan, but since I will occupy the home only 30 days in a year, has now suggest to make this an investment loan, although I will not be renting the property. Any suggestions on how to proceed? Thank you.

Help the community by answering this question:


Technically, the definition of a second home includes the following:
1) Must be a suitable distance from your primary home.
2) Must be available for your year-round occupancy. (Property can be occupied by someone else so long as it's not under a timeshare arrangement.)
3) Must not enter into any rental agreements, and must maintain exclusive control over the property (no management agreements, etc.).

I think you have a gray area here, but investment is the safe way to go if you really will have someone else living there. In my mind, that makes a case that it's not suitable for YOUR occupancy. Yes, you may stay there occasionally, but someone else is LIVING there and that's the distinction.

I'm with your loan officer here and would call it a rental/investment.

Rob Spinosa
1 vote Thank Flag Link Sun May 5, 2013
As per the mortgage guidelines your scenario will not qualify for a second home. Lets look at this scenario from an underwriters perspective. Lets assume you work in San Jose and your primary residence is in Stockton. The commute time from Stockton to San jose is roughly 2 hours- 3 hours depending on traffic. You,re now considering buying a house in Fremont. From Fremont to san jose the distance to your work is only 20 miles as appose to 100 miles. This scenario will most likely qualify Fremont as your second home and stockton as your primary residence- as you will be residing in Stockton over the weekends.
Now lets assume you work in London and want to buy a house in Fremont as your head office is in San Jose. For work related reasons you have to attend meetings every other week in Fremont. This scenario will most likely qualify Fremont house as your second house. On the other hand, if you are only visiting San jose once a year and for only 30 days, underwriter will have a lot ???s to consider this as your second residence. Now if you,re flying in 30 times a year for work reason, that story will be different! But 30 times from London- that's a lot of frequent flyer miles :). All the best
0 votes Thank Flag Link Tue Feb 25, 2014
There are good time shares out there. However, most of them have a waiting list of qualified buyers to purchase when the owners decide to sell.....If it’s being heavily promoted, pushed or tarted up to look good, assume its trash and don't waste your time. If you want a good time share, you will still have to pay for it but go through legitimate channels..
0 votes Thank Flag Link Tue Feb 25, 2014
The word definition is "Primary Residence". this means simply where you live the majority of the time and obviously you can't live in two places at the same time. Therefore your Loan Officer was thinking when they suggested you buy as a "Secondary Residence". That does NOT means 2nd Home, but means it's where you will live while in the area, or on vacation, etc. Take the 10% down and run, other lenders will see you primary as an Investor and want 20% or more. If the LO can't sell the deal to his UTR, let me know. I've gone down this road a time or two. I do not follow each question, please contact me direct if you have any questions.

Best of Luck!
Web Reference: http://www.AFN-Loans.com
0 votes Thank Flag Link Sat May 4, 2013
Thank you. I'm currently in Afghanistan. I was ok with a secondary residence loan, but the LO is saying that due to the amount of time abroad they can't finance the home as a secondary, and I'll need to go with the investment property loan instead.
Flag Sat May 4, 2013
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