trouble financing 4plex with FHA loan

4 Replies

Im freshly out of college and want to get into multi family landlording as my long term investment strategy. I met with a bank this morning and they informed me that my income has to actually cover the payment alone and the other 3 units would not be considered into the FHA approval. I was slightly surprised to hear this and a little bummed out. I get they have to cover their asses in a worst case scenario but it seems to me that loaning 250k on a 4 plex is a much safer bet than loaning me 100k on a single family because no matter what the loan on an SFR, if I lose my job, I can't pay... Anyways, you all understand that already. property values are too high here and I was okay with that, thinking id be able to get in anyways but now I don't think I will qualify for really any 4plex in my area.... Thoughts? Suggestions?

@Jameson Sullivan.

Do your have 2 years of W-2 income and do you have any landlord experience?

As I understand it FHA would allow you to use 100% of rents if filed on schedule E, otherwise you can use 75% of rents on lease/s.

Do yourself a favor and stop talking to the banks, but rather call licensed mortgage loans originators/brokers in your area and have them walk you through the process and your options, I think you will be encouraged.

Finally, I think that your decision to house hack a 4 unit will be one of the smartest choices you have ever made and if you buy right you should be able to live for free or almost free and help you create financial freedom

Best of luck!


Buy & sell single-family rentals online
Radically accessible real estate investing
Get access to exclusive property listings, proprietary data, and support to build your portfolio.
Learn More

@Ashley Pimsner Yes I have all that, My income isnt suoer high though, thats why I hoped to use the other income! Ill call a mortgage broker tomorrow in my area. This is just another little bump in the road!

@Upen Patel I think I might, I havent been super impressed with anyone ive met with. Lots of "I think..." and "let me look at the website"... Like I couldnt have just looked at the website myself?! so frustrating. 

@Jameson Sullivan,

If you are qualified in first two respects I can't imagine that you couldn't get a loan as long as the loan amount isn't outrageous and you had the 3.5% down payment...which can also be gifted by family members.

What is the expected purchase price of 4 flat and corresponding rents? 

Call a mortgage broker asap!