According to standard mortgage practices, how soon must a borrower occupy a property on an owner-occupied loan?

For an owner-occupied loan, it is generally required that the borrower occupy the property within 60 days of closing. This timeframe ensures that the borrower fulfills the owner-occupancy condition, which is critical for maintaining the loan's terms and conditions, as well as qualifying for certain types of favorable rates and programs that are designed specifically for primary residences.

This requirement is in place to prevent misuse of loans that are designed for owner-occupied properties. If a borrower does not occupy the property within the specified period, it could lead to penalties, loan restructuring, or a reclassification of the loan, which may affect the interest rate and terms. Understanding this occupancy requirement is essential for both borrowers and lenders to ensure compliance with mortgage guidelines.