Updated over 9 years ago on . Most recent reply
LLC and FHA Loan strategy
Hello All,
Newbie investor here thinking about using a FHA loan for a multi unit. A couple of concerns with this idea is I'm scared about taking on so much debt since I will be only putting down 3.5% and the fact that the housing market is still smoking hot in the SF bay area.
Could I setup a LLC and buy this multi unit and still qualify for the FHA loan? The reason for the LLC is let's say this unit is a total disaster maybe I can walk just away losing my down payment not my whole life savings. I'm not planning to do this, but I want to cover my bases and know all my possible options before executing a plan. Thanks in advance for your input.
Most Popular Reply
You can't get an FHA loan using an LLC. Fannie Mae won't back a commercial owner. To get an FHA loan, you have to be owner-occupier. Then, down the road you can transfer the property into an LLC or land trust.
Also, FHA is up to 1-4 unit dwellings, with maximum loan amounts depending on # of units.