Refinance While Living Abroad

[Anonymous]

Hello, looking to refinance my mortgage to get a better rate but am currently living abroad for a work assignment and will be for the foreseeable future. My house in the USA has been rented for the past 2 years and will be until I move back. With that being said, would I need to refinance the property under an investment property or my primary residence? I own no other properties. Anything else to consider?

[dragontears]

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@Anonymous wrote:

Hello, looking to refinance my mortgage to get a better rate but am currently living abroad for a work assignment and will be for the foreseeable future. My house in the USA has been rented for the past 2 years and will be until I move back. With that being said, would I need to refinance the property under an investment property or my primary residence? I own no other properties. Anything else to consider?

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Investment property since it currently is rented out and is not your primary residence. The rates are higher for investment property than owner occupied and the LTV is lower (80% LTV is the normal max for investment property, many lenders only go up to 75%).

[TravelNut]

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@Anonymous wrote:

Hello, looking to refinance my mortgage to get a better rate but am currently living abroad for a work assignment and will be for the foreseeable future. My house in the USA has been rented for the past 2 years and will be until I move back. With that being said, would I need to refinance the property under an investment property or my primary residence? I own no other properties. Anything else to consider?

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I'm in the same situation as you (living in Ireland for 2 yrs) and will be refinancing in a few months.  I will not be sharing with the bank that my home is currently rented out (not their business).  I will be telling them that I am out of the country temporarily and will be moving back to this home when i get back to USA.  I have no other home so it IS my Primary Residence technically and your assignment is temporary like mine.  I already talked to my lender and there is no issue with this.

Where you might run into an issue is if your state does not allow you to do virtual notary, which means you can work with a notary online.  My state (AZ) does allow this so I will not have to fly back home to do the signing.  You might have to take a trip back to do this or I've heard that the US Embassy can help with Notary services but I have not looked into that at all.   

[Anonymous]

@TravelNut interesting - thank you for the perspective! 

[ShanetheMortgageMan]

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@TravelNut wrote:

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@Anonymous wrote:

Hello, looking to refinance my mortgage to get a better rate but am currently living abroad for a work assignment and will be for the foreseeable future. My house in the USA has been rented for the past 2 years and will be until I move back. With that being said, would I need to refinance the property under an investment property or my primary residence? I own no other properties. Anything else to consider?

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I'm in the same situation as you (living in Ireland for 2 yrs) and will be refinancing in a few months.  I will not be sharing with the bank that my home is currently rented out (not their business).  I will be telling them that I am out of the country temporarily and will be moving back to this home when i get back to USA.  I have no other home so it IS my Primary Residence technically and your assignment is temporary like mine.  I already talked to my lender and there is no issue with this.

Is your lender requiring an appraisal?  If so, and if your home is rented out, what will they say once the appraiser indicates a tenant is living there?

Doing an owner occupied mortgage requires you to occupy it as your primary residence within 60 days of closing and for the first year of the mortgage, is your lender aware you are physically overseas in Ireland?

[TravelNut]

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@ShanetheMortgageMan wrote:

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@TravelNut wrote:

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@Anonymous wrote:

Hello, looking to refinance my mortgage to get a better rate but am currently living abroad for a work assignment and will be for the foreseeable future. My house in the USA has been rented for the past 2 years and will be until I move back. With that being said, would I need to refinance the property under an investment property or my primary residence? I own no other properties. Anything else to consider?

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I'm in the same situation as you (living in Ireland for 2 yrs) and will be refinancing in a few months.  I will not be sharing with the bank that my home is currently rented out (not their business).  I will be telling them that I am out of the country temporarily and will be moving back to this home when i get back to USA.  I have no other home so it IS my Primary Residence technically and your assignment is temporary like mine.  I already talked to my lender and there is no issue with this.

Is your lender requiring an appraisal?  If so, and if your home is rented out, what will they say once the appraiser indicates a tenant is living there?

Doing an owner occupied mortgage requires you to occupy it as your primary residence within 60 days of closing and for the first year of the mortgage, is your lender aware you are physically overseas in Ireland?

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@ShanetheMortgageMan They do require an appraisal but it will be an automated appraisal with a MMS of 740+ which is where I am so no one will be visiting home.

Lender is aware I am oversees because I explained to them I'm in Ireland temporarily on business and can be called back to USA at any moment.  I also explained to them that I don't want to have to fly back to USA just to sign and they said that can be handled with a virtual notary.

[dragontears]

There is a phrase describing deliberately lying on a mortgage application: mortgage fraud. 

If you are fine with lying be aware of the potential consequences.....

[TravelNut]

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@dragontears wrote:

There is a phrase describing deliberately lying on a mortgage application: mortgage fraud. 

If you are fine with lying be aware of the potential consequences.....

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@dragontears How is it lying?  The application does not ask if the home is rented.  It is my Primary residence in the USA, it is the only home I own.  I have mentioned to lender that home is currently rented temporarily until I return to USA and when i do this will be the home I return to.  

Anybody right now can refinance their primary residence one day and literally rent it out the following day.  How is this any different?

[ShanetheMortgageMan]

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@TravelNut wrote:

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@ShanetheMortgageMan wrote:

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@TravelNut wrote:

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@Anonymous wrote:

Hello, looking to refinance my mortgage to get a better rate but am currently living abroad for a work assignment and will be for the foreseeable future. My house in the USA has been rented for the past 2 years and will be until I move back. With that being said, would I need to refinance the property under an investment property or my primary residence? I own no other properties. Anything else to consider?

---

I'm in the same situation as you (living in Ireland for 2 yrs) and will be refinancing in a few months.  I will not be sharing with the bank that my home is currently rented out (not their business).  I will be telling them that I am out of the country temporarily and will be moving back to this home when i get back to USA.  I have no other home so it IS my Primary Residence technically and your assignment is temporary like mine.  I already talked to my lender and there is no issue with this.

Is your lender requiring an appraisal?  If so, and if your home is rented out, what will they say once the appraiser indicates a tenant is living there?

Doing an owner occupied mortgage requires you to occupy it as your primary residence within 60 days of closing and for the first year of the mortgage, is your lender aware you are physically overseas in Ireland?

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@ShanetheMortgageMan They do require an appraisal but it will be an automated appraisal with a MMS of 740+ which is where I am so no one will be visiting home.

Lender is aware I am oversees because I explained to them I'm in Ireland temporarily on business and can be called back to USA at any moment.  I also explained to them that I don't want to have to fly back to USA just to sign and they said that can be handled with a virtual notary.

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Hopefully your scenario has been actually reviewed by underwriting and it's just an overzealous loan officer making promises.  Since it doesn't appear you'd be paying for the automated appraisal, I guess the only thing you risk is time spent.  Fingers crossed it works out for you.

[ShanetheMortgageMan]

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@TravelNut wrote:

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@dragontears wrote:

There is a phrase describing deliberately lying on a mortgage application: mortgage fraud. 

If you are fine with lying be aware of the potential consequences.....

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@dragontears How is it lying?  The application does not ask if the home is rented.  It is my Primary residence in the USA, it is the only home I own.  I have mentioned to lender that home is currently rented temporarily until I return to USA and when i do this will be the home I return to.  

Anybody right now can refinance their primary residence one day and literally rent it out the following day.  How is this any different?

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A primary residence is the residence that the borrower occupies as their primary residence ("it is my primary residence in the USA" isn't the same thing).  Every situation is reviewed on it's own merits, and since none of us here are your loan officer we can't accurately comment on your specific situation but can only comment on generalities.  While it's not your (the consumer) responsibility to know the requirements for different occupancies (primary residence, second home, investment property) it is the responsibility of your loan officer to know.  Hopefully they've run this up the ladder and have had your situation completely reviewed by underwriting.

To your last question though, someone who refinances their their home as a primary residence one day and rents out that home the following day, without some extraordinary circumstances, would be committing occupancy fraud.  Primary residence security instruments require the borrower to occupy the home within 60 days of closing and for the first year of the mortgage.