Jclugston, Both Buyer and Seller in Wichita Falls, TX

Hello! I currently rent out what was my first home, but I never changed the mortgage from a "standard" one to a rental property.

Asked by Jclugston, Wichita Falls, TX Sun May 16, 2010

First, are there any issues with that? And second, I am looking to refinance, is there anyway to keep from getting hit with the extra point or so for a rental property mortgage? Thank you in advance for your help!

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Regarding your first point: Don't worry. There is no "standard" mortgage versus a "rental property" mortgage. If you bought the first home, the mortgage that you started off with is fine. No problem. Never was any need to change it.

It's just as if you'd bought a car and had a car loan. Then, after a few years you decided you wanted a new one, so you bought a new car and your wife ended up driving your first one. You wouldn't have to go back and refinance or get a new car loan on that first car.

So, don't worry about that.

As for refinancing, now you run into the difference between rental properties and primary residences. And, yes, it's likely that you'll have to pay more, overall, to refinance the rental than if it were your primary residence. However, check with a good mortgage broker for guidance on that.

Hope that helps.
1 vote Thank Flag Link Mon May 17, 2010
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
Contact
Per the previous responses, your mortgage doesn't change but your homeowners insurance would. Make sure to change the insurance coverage to non-owner occupied. Your liability would go higher but the contents would be lower. So overall, it should be lower.

Naima
Web Reference: http://www.sumnerrealty.com
0 votes Thank Flag Link Wed May 19, 2010
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