Hello Everyone, 

I just purchased my first duplex and closed last week. I am now trying to get into a fourplex which my mother will occupy - she will be in the title and I will be a co-borrower on the mortgage. I spoke with a lender that stated that we'd need 15% down to finance the property as a primary residence. I know there are more restrictions for lenders in this market, but 15% down sounds very high based on my research. What requirements/loan options have you used for a fourplex with owner occupied loan?

Hi @Senia E Cuevas , congrats on doing another deal! Your lender is quoting you the down payment for a conventional owner-occupied multi-family property. I would urge you to ask your lender a better question. Ask them how you can qualify for the FHA 3.5% down payment option. FHA is the program you want to target for a lower down payment if you are going to occupy the property.

@Brad Hammond Thank you so much! That is the right question to ask!  Thank you for getting me closer to my goal!

If you are a non-occupying co-borrower, then the minimum down-payment on an FHA loan is 25% if 2-4 unit. For a conventional loan, it will be 20% (unless you can find a non Fannie/Freddie local bank).

I would see if your mom can qualify on her own for a 4-unit with FHA. Happy to answer any questions!

Originally posted by @Senia E Cuevas :

Hello Everyone, 

I just purchased my first duplex and closed last week. I am now trying to get into a fourplex which my mother will occupy - she will be in the title and I will be a co-borrower on the mortgage. I spoke with a lender that stated that we'd need 15% down to finance the property as a primary residence. I know there are more restrictions for lenders in this market, but 15% down sounds very high based on my research. What requirements/loan options have you used for a fourplex with owner occupied loan?

Like others have said, see if your Mom can qualify using FHA. On a 4 unit, there is a self sustainability test for the property (just an FYI).

You deserve kudos for being up front with your lender.  Many people would try to snake their way into the 4 unit, saying that one is owner occupied too and then wonder why their loan got turned down.

Stephanie

@Stephanie P. Thanks for your reply. I do not like shady things - specially as I start with real estate. At this point, I will either buy for her as an investment or find a home she can afford... I do see real estate as an income vehicle for a 67 year old that was not able to build on her retirement. I'd be happy to plant the seed for her. 

@Gaetano Ciambriello Thank you! We are waiting for her retirement to kick in to have her apply on her own. I will DM you. 

Originally posted by @Senia E Cuevas :

@Stephanie P. Thanks for your reply. I do not like shady things - specially as I start with real estate. At this point, I will either buy for her as an investment or find a home she can afford... I do see real estate as an income vehicle for a 67 year old that was not able to build on her retirement. I'd be happy to plant the seed for her. 

You're going to do great things.

RE is a great retirement vehicle.  Best of luck to you.

Stephanie