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Where can i rent a house
Do I Need to Notify My Mortgage Company if I Rent out the House?
Notify your mortgage company before renting out your home.
- 1 Rent Out Your Home When You Still Owe a Mortgage
- 2 Can I Rent My Home & Get Another Loan to Buy a New One?
- 3 Can I Rent Out My Home With an FHA Mortgage?
- 4 Can You Rent With a FHA Loan?
If you own a home you may be tempted to turn your property investment into a revenue-generating machine. If these thoughts have crossed your mind, you aren’t alone. As the number of DIY property services continues to increase, many homeowners are exploring new methods for not only paying down their mortgage but also creating a legitimate and profitable business using their home. When you decide to rent out your property, you will most likely need to notify your mortgage lender. It is quite possible that your lender will require certain information or actions to take place before they sign off on your rental plans.
You should live in your primary residence for a minimum of 12 months before renting it out in order to stay in the good graces of your lender. They will consider extenuating circumstances, however, so be upfront and discuss your options to avoid being accused of mortgage fraud.
Evaluate the Terms of Your Contract
Evaluating your mortgage contract should be your first priority after you have decided to begin renting your property. Carefully review this document in order to determine whether or not your lender has incorporated any stipulations related to renting out your property, such as a statement that the property will be owner-occupied. If there are no specific restrictions written into your contract you should be able to rent out your home as you see fit. Your lender may still require specific documentation that will ensure that your mortgage is not put into jeopardy.
Review Additional Requirements
After you have reviewed your contract, you may choose to notify your mortgage lender of your plans. It is not uncommon for lenders to request additional insurance coverage for your property given the fact that tenants may be moving in and out frequently. Similarly, your lender may ask that you require your tenants to obtain rental insurance prior to moving in. Perhaps most importantly, you should notify your lender as soon as possible regarding your new mailing address, assuming you are not living in the property while it is being rented. This will ensure that all critical documentation related to your mortgage will find its way to you and not end up in the hands of your tenants.
Although rental property can, of course, generate large revenue streams for property owners, it is quite important that you continue to plan and save for mortgage payments on the property. Even though you may be using your tenant’s rent to pay your mortgage, there will likely come a time when your property sits unoccupied between tenants. It is at a time like this when smart financial planning will ensure that you don’t miss a payment on your property and risk penalties from your lender.
Your level of accountability and responsibility only increases when you become a landlord. Make sure you are fully prepared to meet this new financial obligation and business opportunity head on!