Relative in home / owner occupied?

[NORTON]

i just tried to call a borrower who is apparently in Alaska...home in California...occupied by son...haven't spoke to borrower yet but, if she tells me she resides part time in California...and heads to Alaska to work...is it still owner occupied? or is the owner required to reside full time at the subject property, what about part time residency, etc.? thanks.

 

[Pamela Crowley (Florida)]

That is one where I would demand a signed letter regarding the occupancy or I would check that it's tenant occupied, with an explanation of who told you what. In any case, I would include an explanation of who told you what.

 

[CSP 49]

I'm glad someone started a thread like this. I seem to be running into this issue more frequently. I'm letting a family member/friend, etc. stay there temporarily but they are not paying rent. This is my second home and I'm doing a favor.

I've also received some questions on my calling non-owner occupied properties in projects near Disney that allow short term rentals tenant occupied. These are properties in short term rental pools that owners may use a couple of weeks per year.

Let the debate begin as to what constitutes a tenant.

Is payment of rent necessary?

Length of stay? We have weekly rentals available in second homes so I would not think this would be a deciding factor.

I do have one useful check available in this area. Power and water bills are public records so I can call the utility provider with an address and find out whose name the utilities are in.

 

[claireryder]

I was taught, and it certainly could be incorrect, but if it was a child occupying, it is considered owner occupied. But again, that could be wrong.
We have the same issue in Colorado in the mountains with short term ski rentals. Then this brings another issue into play when you get the condo cert.

 

[Pamela Crowley (Florida)]

Does the actual person who's name is on title actually LIVE in that property 50% or more of the time. If it's anything under 100% of the time, it needs to be fully explained.

Owner that stays there 2+/- weeks per year while the rest of the time it's in a rental pool is aka a timeshare.

 

[Terrel L. Shields]

I was taught, and it certainly could be incorrect, but if it was a child occupying, it is considered owner occupied. But again, that could be wrong.

I would concur.

Owner that stays there 2+/- weeks per year while the rest of the time it's in a rental pool is aka a timeshare.

Clearly a different situation than when family lives there.

Our family farm has 3 dwellings occupied by owner/part owners all...no rents have ever been paid on any of them. The "owner of record" of 2 of those travels as a traveling nurse and 'occupies' one only a few days a year. Her daughter lives there full time. I would say it is "owner-occupied". The daughter pays no rent and in reality owns ¼ the total property as well as being successor trustee to my part.

 

[Michael Tipton]

Does the actual person who's name is on title actually LIVE in that property 50% or more of the time. If it's anything under 100% of the time, it needs to be fully explained.

Owner that stays there 2+/- weeks per year while the rest of the time it's in a rental pool is aka a timeshare.

Pam, I would refer to it as a condo-hotel, not a timeshare. There are several local condo developments where the docs permit owner occupancy for a limited period per year.

The timeshares I am familiar with are/were marketed for individual weeks.

 

[NORTON]

I was taught, and it certainly could be incorrect, but if it was a child occupying, it is considered owner occupied. But again, that could be wrong.
We have the same issue in Colorado in the mountains with short term ski rentals. Then this brings another issue into play when you get the condo cert.

if this were to be accepted as the proper way...then a person with five children could be owner occupied on five different properties?

 

[Pat Butler]

This is the problem with form reporting. Fannie fails to provide us with guidance in this area. What I do when confronted with atypical occupancy is to put an asterisk in the box and fully explain I know in an addendum. Let the lender figure it out according to whatever guidelines they want to make up on their own.

It is logically impossible for us to always be able to answer the occupancy question when not provided with a full definition of what constitutes "owner occupied".