Can I buy first home in different state and not planning to relocate? Could that be considered as my first home? Thinking of something investment point of view until I am not finding some good deal in my state. TIA

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You can buy your home in any state but your mortgage won’t be approved if you don’t plan to relocate and use it as your primary home. The IRS would need to see it as your home address for tax returns, drivers license, and voter registration card. There are also tax advantages and lower mortgage rates for primary home. But if you don’t plan to live in it, it will be classified as an investment property and that’s another beast. Regular banks and lenders won’t even give you a loan easily for that and the interest rates are higher. Do your research.

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If it's not going to be your Primary Residence then you'll likely need a higher down payment, 25% isn't abnormal for a situation like this. Interest rates for mortgages on investment properties tend to be a little higher also. There's a lot to consider when buying a home, don't hesitate to reach out if you have any questions.

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Will you live there for any part of the year or only rent it?

I bought a house in another state that is classified as a second home (even though I don't own a first home) in Oct. 2021. We stay there a couple months a year and rent it the rest but I think the requirement for being a second home is only a few weeks a year. I got literally the same interest rate as when I first applied for the loan as a primary residence and did not have to put more than 20% down. Maybe that's changed as rates have gone up but shop around and see what you can get.

Either way, don't try to fib to get a better rate. That's illegal.

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In addition to a different mortgage, you’ll also need the correct insurance if it’s not your primary residence. Your insurance agent can help you with that. I agree with the other comments, make sure you’re upfront about the property use for both.

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