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Vacation property mortgage qualification on own home

I have a vacation home that my mother uses. She has offered to pay rent or pay the monthly property tax. I am applying for a mortgage for my primary residence. What is the best approach to lowering the monthly debt attributable to the vacation property so that I can qualify for a larger mortgage on my primary residence?

Harry Jensen, Trusted Mortgage Expert with 45+ Years of Experience
, Trusted Mortgage Expert with 45+ Years of Experience

If you want rental income from a vacation property, or any second home / investment property, to be factored into your mortgage application then you need to provide documentation for that rental income. Lenders typically require that you provide a Schedule E from your tax returns that verifies any rental income you receive. Although it is very uncommon, some lenders may accept cancelled checks or lease agreements as evidence of rental income. We provide a comprehensive overview of non-owner occupied mortgages on FREEandCLEAR.

Also, having your mother pay for the property taxes and removing the tax payment from your monthly bill will not lower your monthly debt from the lender's perspective. Lenders will include total monthly housing expense from your vacation home including your mortgage payment, property taxes and homeowners insurance as part of your monthly debt because ultimately you are legally responsible for those items even if someone else pays one of those bills.

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About the author

Harry Jensen, Mortgage Expert

Harry is the co-founder of FREEandCLEAR. He is a mortgage expert with over 45 years of industry experience. Over his career, Harry has closed thousands of loans for satisfied borrowers and now offers his advice and insights on FREEandCLEAR. More about Harry

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