What About an In-Law Apartment?
For many home buyers, especially first-time buyers, managing the cost of a home can really be a stretch. Purchasing a home with the potential for producing income may be an option.
Although many residential areas are zoned for single families only, often an “in-law” unit is allowed. This is an area, separate from the main part of the home that has its own entrance, kitchen and bathroom, so that an individual can live separately from the family. Before considering this option, be certain that zoning laws in the area will accommodate this type of arrangement. Also be sure the addition or remodeling was done with the proper permits and is up to code.
A lender may or may not consider the potential income when considering you for a loan. If the work wasn’t done properly, the addition may be deducted from the value of the home, causing the property to appraise for less than the purchase price. Be cautious if you feel you cannot pay the mortgage without the anticipated rental income. A reliable loan officer can be very helpful in determining what is best for your particular situation.