Grad Student FHA Loan for a Four Plex?

Question

So I have a pretty specific situation that I can't find much information about. I'm a grad student with a full ride scholarship, $10,000/year stipend, no debt, a nice chunk in the bank from crypto (but not enough to buy anything outright -- not like I'd do that anyway), and a wife that makes <$30,000 per year at the moment. Are we eligible for an FHA loan to house hack w/ a four plex or is there no work-around for our lack of income? Has anyone ever seen any creative ways around this?

Matthew Brill · Answer

It will be tough to qualify without a lot income to show but it will depend on the loan size (you might not be able to do FHA 3.5% but you can put more down to lower the loan amount and improve your DTI). Also, if you find a screaming deal that will help your DTI as well. The best way to find out is to find a local lender and ask them how much of a loan you could qualify for. Then you can search your market for price points and know how much money you'd have to put down to get the deal.

Bob Okenwa · Answer

It will be hard to secure a traditional loan without enough income to keep your DTI ratio in line with the requisite thresholds. You did not mention which price point you would be looking to purchase at. With a large enough down payment, you may be able to find something that works if the property is something you can afford.

You can look into seller financing or getting a co-signer as alternative methods to getting a loan. Or try to find a lender that will use your stipend as income and that may help you get over the hump as well.