home mortage/renting house out

S

slow z

Club Member
Long story short im looking to move back the east side of michigan currently in grand rapids. I bought this house a little over a year ago and called up the mortage company to see about renting it out if that was an option. They said i could not rent it out? really didnt ask why i couldnt just said ok and got off the phone.

My question is how would they know if im renting the place out? what would happen if by chance they found out? I would like to to just sell the place but i know with the market etc it will either be up for sale for a long time or i would have to sell it for a lost which i do not wanna come out of pocket. I will be posting the house for sale in a couple local forums/ sites if anybody is interested
 
You can rent it out, but your tax rate wil increase. I dont know why the company holding your mortgage would tell you that you can not rent.
 
I'm sure they'd find out pretty quick when you went to get another mortgage or it changes as your primary residence.
I'm also considering renting mine out till I can sell it for what I owe. I know your taxes go up about 20%.
 
Don't forget homeowners insurance, your current policy may not cover it if it's a rental, Foremost covers rentals. As soon as your current insurance provider finds out it's a rental they'll most likely drop ya, don't file a claim on it.
 
99Electriccobra said:
Don't forget homeowners insurance, your current policy may not cover it if it's a rental, Foremost covers rentals. As soon as your current insurance provider finds out it's a rental they'll most likely drop ya, don't file a claim on it.
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this is false.. all you have to do is switch it from a homeowners insurance policy to a fire dwelling policy. this is set up for people who do not occupy the house all the time. its typically a little more expensive though
 
kammi10 said:
this is false.. all you have to do is switch it from a homeowners insurance policy to a fire dwelling policy. this is set up for people who do not occupy the house all the time. its typically a little more expensive though
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Change your policy to a landlords policy. This specifies it as a rental and covers the basic structure of the property. The renters are responsible to have a renters policy that covers personal assets. You can make this a requirement in the lease agreement if you chose. You can also get a personal umbrella policy to cover you incase you were to get sued. This gives you additional coverage above and beyond the landlords policy. Contact the city and register it as a rental. Your taxes will go up. Warren also has forces you to have the house inspected every-other year. They charge a 120.00 fee to do so, it is basically a joke and they want to make sure you are not a slumlord.

Good luck, I have a couple of them
 
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