Typical residential mortgages are for owner occupied first and/or second homes. The mortgagor usually is required by the lender to sign some paperwork to the effect that the mortgagor agrees to occupy the dwelling and not to rent it out. If one rents out a mortgaged home it should be financed as a rental which is understandably usually at a little higher interest rate.
Now how would a mortgagee learn a mortgagor rents the house out? I don't know how well most lenders police their loans but that is a good question. If a house is owner occupied one normally gets a homeowner's insurance policy as required by the lender. If one rents the house out it should be insured as a rental. If it is the lender would receive a copy of the policy on a rental house, not on an owner occupied home.
Most people buying homes in The Villages who plan to rent them out for a while prior to eventually occupying them may just hope that their lender never checks and they do not have to deal with an insurance claim on their rented out house I guess... I really do not know. IMHO that is a chance I would not take.
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Last edited by manaboutown; 11-23-2020 at 05:40 PM.
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