Conventional financing for duplexes

[Paul Weller]

I am looking at a duplex listed in the eastside of the Seattle area.  The mortgage broker that I have been talking to stated that I since it is a duplex I wouldn't be able to get financing unless I had 25% down and I think this was through conventional.  I might be able to get 10% but not the whole 25%.  What are my options?  Can seller financing cover a portion of the 25%?  Other programs?

Thanks!

[Kelly N.]

Hello Paul,

Unless you plan to live in one of the units of the duplex, you will have to put 25% down for conventional financing.  The maximum credit the seller can give you at closing is 2% (from what I have been told) and the banks are going to want to see where the funds came from.  If you are purchasing a primary residence, you can use gift money from someone else, but they will not allow gift money for a down payment on an investment property (not sure how it works with owner occupied though).  They will want 2 months of bank statements to see that the funds are indeed yours, and will scrutinize any large deposits to make sure they are not loans.

Kelly