Foreclosures - Is it possible to NOT put down 20%?

7 Replies

Hi BP,

I've come across a great deal but the property seems to be a foreclosure. Is there any possible way to obtain the property with FHA loan?

Thank you in advance,


@Christopher Phillips

Q1 - I have not seen the property in-person but I plan to soon.

Q2- I currently plan to house-hack the property. However, this might be an opportunity to flip for its true retail value. 

@Michael Peralta

If the condition is okay, you can buy with an FHA loan. However, you have to have the intention of occupying one of the units.

If you plan on flipping it, don't use an FHA loan.

If its 1 unit you  need 15% down payment for investment property. If property need the work you won't be able to buy under conventional loan for investment property. 

Try the Fannie Mae Homepath Program if you plan on using as primary residence. It’s a conventional program (important for homes requiring work compared to FHA), requires only 3% down and generally beats FHA mortgage insurance costs.

Last two clients of mine have purchased their homes through this program that very likely wouldn’t have been financeable through FHA.

Good luck

Homepath financing has not existed for the last 4-6 years.
You can finance a foreclosure property just the same as any other property. If in financeable condition you can do fha 3.5% down or conventional 3-5% down as an owner occupant.


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