Purchasing quad with conventional loan

[Omar Diaz]

Hey BP community, I'm a first time home buyer that is trying to purchase a quad with a conventional loan. My question is: do I need a 25% Downpayment on a Quad in North Carolina if I intend to occupy one unit and rent out the 3 other units? My loan officer informed me that I need 25% dp and 6 months worth of expenses as opposed to my initial plan of putting 5% down however I have read otherwise. I did inform her that I will be renting out other units if that makes a difference

[Michael Cohen]

Go FHA with 3.5% down

[Adam Schneider]

@Omar Diaz What type of loan are you using?

[Earnest Boyd]

I'm new to REI as well. From my readings thus far I would also suggest that you could find a private lender to put up the other 20% if you must do the 25% loan but only if the suggestion from @Michael Cohen doesn't work out.

[Tyler Watts]

Every bank is different and every loan is different. Shop around to local banks and tell them your story and they'll tell you what they can do. Dress up, walk in and start selling your deal to the bank!

[Omar Diaz]

Michael Cohen

I considered doing an FHA with 3.5% down however I wanted to put down just a bit more to reach my desired bottom line. I've reached out to other lenders who say that it's not a requirement so I may be using another lender.

@Adam Schneider

I'm using a conventional loan for a residential purchase

@Earnest Boyd

I hadn't considered a private lender! My only concern is that I'm trying to keep my expenses as low as possible in the beginning and don't plan to refinance in 2 years.

[Omar Diaz]

@Tyler Watts

Thanks for the advice, very appreciated!

[Michael Cohen]

3.5% is the minimum. You can put down more. 

[Debra Grumbach]

Originally posted by @Omar Diaz:

Michael Cohen

I considered doing an FHA with 3.5% down however I wanted to put down just a bit more to reach my desired bottom line. I've reached out to other lenders who say that it's not a requirement so I may be using another lender.

@Adam Schneider

I'm using a conventional loan for a residential purchase

@Earnest Boyd

I hadn't considered a private lender! My only concern is that I'm trying to keep my expenses as low as possible in the beginning and don't plan to refinance in 2 years.

 @Omar
FHA only requires 3.5% but if the 5% makes a difference on the bottom line then do it. Be sure to tell lenders that you want an "owner occupied" loan. And if that who told you 25% and 6 months with that info, dump 'em.

[Omar Diaz]

@Debra Grumbach

I think I'm going to dump this lender because they're standing with those terms

[Harjeet Bhatti]

@Omar Diaz

You can buy under home possible with 5% down payment or 3.50% with FHA. Both products are good for 4 units.

[Omar Diaz]

Thank you all for the responses! Turns out the rent roll wasn't worth the hassle