Hi All!

I've been in the market for a 2-4 Plex property for a while, but am just out of the range of FHA limits. I'm looking in a pretty "hot" market with some pretty pricey properties with the intent to owner occupy. I have a perfect credit score, stable job and enough to put 5% down but am usually 25-100k out of the loan range I need to be in.

Is there any hard money lenders that would loan right now past FHA limits?

For some of the deals that are just out of reach, I'm thinking about going the hard money route and refinancing a year or so down the road.

Thoughts?

Ben

@Ben Hunt Hard money is for investment transaction, they don't loan on an owner occupied property. There might be portfolio lenders, they will look for a lot more then 5% down, and there would be points involved. If you are limited on cash, then your best option is to work backwards into a loan limit/purchase size.

Originally posted by @Ben Hunt :

Hi All!

I've been in the market for a 2-4 Plex property for a while, but am just out of the range of FHA limits. I'm looking in a pretty "hot" market with some pretty pricey properties with the intent to owner occupy. I have a perfect credit score, stable job and enough to put 5% down but am usually 25-100k out of the loan range I need to be in.

Is there any hard money lenders that would loan right now past FHA limits?

For some of the deals that are just out of reach, I'm thinking about going the hard money route and refinancing a year or so down the road.

Thoughts?

Ben

Hey Ben

The FHA loan limit for the Austin MSA is $389,850. If you've got 5% to put down, you're probably going to have to get more creative; find a multi family that's a mess and and do a 203K (live in one unit and renovate the other and then vise versa) or get some seller financing, but keep the price point down lower. Buying past that price point with only 5% down is a recipe for disaster. You're under capitalized for owner occupied money that's that expensive and hard money won't work for owner occupied or a first home.

@Stephanie P. the FHA loan limit changes for small multifamily and scales per number of units up to $778,450 for a quadplex in Travis county and for the Austin MSA. Source below:

https://entp.hud.gov/idapp/htm...

@Bryan Noth Correct.

@Upen Patel , Even if you plan to rent out the other 3 units? What about if I just rent out all 4 with the hard money loan and move into one of the units when I'm able to refinance it?

@Ben Hunt You understand...?

HM rates are more than double fha/conventional rates

They don’t do 5% down, more like 25-35%

How would you refi out of the HM later into fha if you can't now (assuming you could wiggle around the "HML's can't lend on owner occupied" and a fha refi would require prior occupancy)?

Originally posted by @Bryan Noth :

@Stephanie P. the FHA loan limit changes for small multifamily and scales per number of units up to $778,450 for a quadplex in Travis county and for the Austin MSA. Source below:

https://entp.hud.gov/idapp/htm...

Thanks Bryan. I thought my number was low when I pulled it up. I don't do FHA at US Commercial, but that number you had makes my point even more. The OP is under capitalized.

Best of luck

Stephanie

Talk to various local small banks/credit unions. Many will do jumbo owner occupied at 10% down and you may find some willing to do 5%.