Home Buying in New Jersey>Question Details

Emh, Home Buyer in New Jersey

If my first home is a rental property will I be viewed as a 1st time home buyer or investor for mortgage purposes? Does single unit vs. duplex matter

Asked by Emh, New Jersey Fri Oct 1, 2010

Part of my professional compensation is rent and utility free housing. I want to leverage that by building equity with a home that will help pay for itself.

Help the community by answering this question:


If you are not intending on living in the home you are an investor. To get the benefit of interest rate and money down you must live in the home. Most lenders require you to live in the home for 1 year.

Homestead Realty Inc
0 votes Thank Flag Link Sat Oct 2, 2010
As long as you occupy one of the units and have not owned a home for 3 years(for IRS purposes). You will be considered as owner occupied/1st time home buyer. Some grant programs and such in NJ will have specific criteria for being a 1st time home buyer, but it will depend on the program. Obviously, You are best to consult with a tax advisor with regards to the IRS guidelines for being a first time home buyer, and individual lenders and/or programs for their guidelines.
0 votes Thank Flag Link Fri Oct 1, 2010
Emh, if I am interpreting your question and statement correctly, then you're sayiing your job provides you with housing at no cost to you and you would like to invest your money and buy a home.

If that is correct & you plan on buying a house you will not live in & you plan on financing the transaction you will be deemed as an INVESTOR. You will be required to meet investor standards for mortgage down payment, reserves and credit.. (Usually 20% down, 6 months reserves of mortgage payment after closing, a 700 credit score and possibly a history as a landlord)

If you say you are going to live in the property but don't that is deemed as mortgage fraud by the FBI, so I don't recommend do such.

You want to renegotiate your compensation package too include a housing subsidy so you use that money to pay for a place of your own. If this is possible I would look at a duplex at a minimum.

BTW There really is no difference being a first time home buyer or a returning buying. All the standard mortgage programs will be available to you.

Good luck with your endeavors Emh. If you would clarify the question, I could be more precise with my answer. Hope you have a great day!
0 votes Thank Flag Link Fri Oct 1, 2010
It does make a big difference if you occupy the home or not. Your rate and insurance will be different if its strictly an investment property and not a personal residence. Speak to a qualified mortgage lender before purchasing so you know how this will affect you. Here's a link for who we reccommend http://www.justjerseyrealestate.com/mortgage_Financial.aspx
0 votes Thank Flag Link Fri Oct 1, 2010

I certainly think speaking to a mortgage rep can provide better answers to your question either Trulia or you can stop into your local bank and speak to someone there. If you are not occupying the home, most likely you will be considered an investor and mortgage rates will be different. I know my in-laws pay a higher rate because they own a multi family which they rent out but your situation may be different so speak to a mortgage rep.

Good luck and its beneficial to you that you are doing your homework first before jumping in, buying it and then having to deal with issues that you weren't aware of regarding lending.

Gina Chirico, Sales Associate
Lattimer Realty
973-715-1158 cell
973-575-6353 ext 17 office
0 votes Thank Flag Link Fri Oct 1, 2010
Not sure what you mean. Do you OWN a property that is rented out to others including yourself?
If you are on the deed, you will not be considered a first time buyer. I had a client who co-signed to help his sister purchase a home he never ever lived in, and he was not considered a first timer.
0 votes Thank Flag Link Fri Oct 1, 2010
Hi Emh, good for you for thinking ahead! I think the difference, from mortgage purposes, lies in whether or not the property is your primary residence... I'm sure there are mortgage reps on Voices who will chime in here with a better answer.

Good Luck!

0 votes Thank Flag Link Fri Oct 1, 2010
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