Buy a Property with a friend using FHA Loan

4 Replies

Hi all,

A friend and I are interested in purchasing a 4-unit multi-family property together to live in and rent out the remaining 3 units within the next 6 months or so. Two questions:

1) Can we get an FHA loan together on the property so that we only need to come up with a 3.5% down payment?

2) When should we realistically begin making offers and looking to buy a property if our goal is to move in during the August/September time frame?

Originally posted by @Nicholas Lisauskas :

Hi all,

A friend and I are interested in purchasing a 4-unit multi-family property together to live in and rent out the remaining 3 units within the next 6 months or so. Two questions:

1) Can we get an FHA loan together on the property so that we only need to come up with a 3.5% down payment?

2) When should we realistically begin making offers and looking to buy a property if our goal is to move in during the August/September time frame?

 1 - Yes. But understand the legal and financial risks involved with buying a property with a friend.  Make sure you have some sort of document outlining everything

2 - Now.  It can take 6-9 months to find a place.  Just don't rush it.  Don't buy a bad investment just because you have a deadline

Originally posted by @Nicholas Lisauskas :

@Brie Schmidt Thanks for your response! This may be an obvious answer, but could you elaborate on the "legal and financial risks" involved with buying a property with a friend?

 What if he files for bankruptcy?

What if he wants to sell? can you buy him out, do you have to sell?

How will the profit be split?  If nothing is in writing then that could be argued in court

What if years down the road you want to move out?  What will he pay? What if he defaults and you lose the house?