Need a Source for Owner Occupied 2 Unit Down Money

4 Replies

My wife and I are splitting up and she has a contract for a 2-unit where she will move in one and rent the other. The lender put her through the rigorous application process and suddenly the loan officer is telling her that he JUST discovered that the guidelines require her to put 15% down instead of the 5%.

I'm pretty sure that's false, but I want an official reference (on the web) to show him it's false (unless it's not). Thank you in advance!

AFAIK only FHA loans allow just 5% down. Is that what she's getting?

Many banks and lenders apply their own "overlays".  If he's telling you its a requirement it probably is for loans he originates.

Also, if you are wanting a name for a specific lender you'll need to post in the Marketplace.

TY Jon,

I'm sorry, I do not know what AFAIK means.

I'm assuming when the lender says "guidelines" they are referring to Fannie Mae?

She is applying for a conventional at 5% down owner occupied at a local bank. I thought 5% was the norm for conventional and 3.5% for FHA.

AFAIK - as far as I know.

Even if Fannie or Freddie allow 5% down for OO loans (sorry, not sure) the lender may have an overlay that requires a higher down payment.

Fannie Mae document are here.  Look at the selling guide.

SOmehow I found the Eligibility Matrix for Fannie Mae:

Where, unless I'm missing something, a 2-unit owner occupied DOES indeed need 15% down. Does anyone know otherwise? ...because this is going to kill the deal. Thank you.

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