Hi, I am looking to buy a duplex in New Orleans, LA for about 400k-700k. I would put down 5% and then pay enough to get to 20% while living there within a year or two, then refinance to get rid of PMI and to cash flow better, when I will move out and rent out both sides. The reason I wouldn't put down 20% now is because I don't have the cash, but will make it soon from my day job, which is stable. I am being told that this may be too expensive for a loan with less than 20%. Is this accurate? Are there loans that would allow me to do this?
You would have to go FHA first as there are no 5% down conventional programs for duplexes. Then once you have the 20% you would need to refinance it to conventional.
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@Nicholas Covington thank you very much!
@Corey Gregg Ask your lender but there are loan limitations with FHA. I purchased a duplex in Orleans parish last year and I believe the limit on a duplex was around 420k at that time.
@James Babin thanks that’s what I’ve been finding too. Looks like I’ll be finding something less than the limit or waiting to save for a bigger down payment.