Owner Occupied Duplex/Triplex

4 Replies

Hey everyone! I am new here so I apologize for the incomplete profile. My name is James and I am 21 years old. I currently live in southern California. I plan on moving to Texas around March of next year with my Fiancee. I have been looking into purchasing duplexes/triplexes around $100,000 and having the other tenants pay the mortgage or help with it. I own a credit repair company so I have that as income but I am still starting out and am looking to save as much money as possible (Which is why I am looking at this VS. an apartment.) I also want to start building myself up in real estate investing and I figured this would be the best choice to start. I have also read that getting an FHA loan is easier if your owner occupied. and I can put 3.5% down. So I guess my questions are, does anyone do this in Texas? Does anyone have any good advice? I spoke with Wells Fargo today and they said for an FHA loan at $100,000 with $3,500 down I would be at about $900 a month in mortgage payments with a 740 credit score and $5,000 in closing costs. Has anyone done this before starting out? I am curious to learn as much as I can! Thank you all for your replies!

You can buy 1-4 units under home possible with 5% down payment. FHA is good option but you pay 1.75% UFMIP fee which you are not paying under conventional. You can add this fee in loan or pay at closing but eventually you are paying any way.

@James Peters , your idea is discussed every day here on BP.....search the forums for "house hacking". Yes, your idea has a lot of merit, in that, since you're owner occupied, you get the 3.5% minimum down payment. Otherwise, you'd be required to put 25% down on a rental property that you don't occupy. If your numbers work out, yes it's possible that the other units in a duplex,triplex or quad could cover the mortgage payment, and you "live free" or heavily discounted....allowing you to use your $900/month of otherwise rent or mortgage....to do more REI.

Also, I am self employed. For an FHA loan is it a must that I have 2 years of Tax returns for my business? Or can it be included with previous jobs? I have only been in business about 8 months. Thank you!