Purchase a second home for investment

**fmkbbkk** · 05-04-2009, 10:32 AM

Hi,

Did President Obama pass a law stating that you could only buy a second home if you (the buyer) shows occupancy (is this possible) towards home and not to be used as an investment. If there is such law passed? and does it apply everywhere in the U.S. Correct me if I'm wrong and where can I view such laws with real estate passed by the President.
If such law did ever exist, when did this come in effect?

Thank You!

**Vegasloanlady** · 05-04-2009, 12:13 PM

You can always buy a second home if you can show that your current home is in a vacation area. This will allow you to buy the new one as owner occupied, thus getting a better rate.

**stevetrang** · 05-04-2009, 12:32 PM

No, Obama did not pass any laws as far as who can buy what. That would be a very egregious step for any president to take.

**fmkbbkk** · 05-04-2009, 12:46 PM

Vegasloanlady,

My situation is this...it's in the same state and the area I am looking at is about 10-15 miles away from my existing home. What would be considered a vacation area?

**REITrainingWhse** · 05-04-2009, 01:49 PM

Originally Posted by fmkbbkk

Did President Obama pass a law stating that you could only buy a second home if you (the buyer) shows occupancy (is this possible) towards home and not to be used as an investment.

Yikes!! If this was the case, the world would end! There is NO WAY that anyone would want to even consider that!

Anyone can buy as many or as few properties as they want. Now you might be talking about getting the 10% (up to $8K) tax credit for first-time homebuyers, and then YES the property needs to be your homestead, (this credit is not available for investment properties.)

So, don't fear about RE investing, it is still strong, and legal.

Later!

**luke8000road** · 05-08-2009, 08:23 AM

the goverment of Beijing allows people form over sea buy two or three house without too many limits. and you can sell it in 3 years .as you know,the price of house in Beijing is incise rapidlly.it's a nice place to set you investment. more massage form realestatebeijing.com.cn

**Greg** · 05-09-2009, 04:36 AM

Originally Posted by fmkbbkk

Vegasloanlady,

My situation is this...it's in the same state and the area I am looking at is about 10-15 miles away from my existing home. What would be considered a vacation area?

If the second home you are buying is located too close to your primary residence then it might be considered an investment property and not a second home. The second home status comes with a lower interest rate and lower down payment than an investment home.

Talk to your lender and see what they have to say about the distance. I think the 10-15 miles might be too close but I could be wrong.

This rule has been around for a long long time.

**stevetrang** · 05-09-2009, 11:14 AM

General underwriting guidelines say no second homes within 50 miles. However, a compelling letter can help get you past that guideline. Unfortunately, there is no certainty until underwriting.