Rental Property Investor · Houston, TX · Member since 2017 · 12 posts · 2 votes
Hello everyone,
I currently live in Houston, TX. I would like to purchase a multi-family property in Austin, TX through financing. It seems to me that an FHA loan would be my best best because of the low down payment required and low interest rates. However, because I do not live in Austin and I do not plan to live there (at least not any time in the near future), is there a way I can still successfully apply for an FHA loan? I understand the FHA loan requires the buyer to live in the property for at least 1 year.
For example, I have a good friend who lives in Austin and I would trust him to live in one of the units of the property and manage it for me. Would it be possible for him and I to put our names on the deed or lien, and the requirements of the FHA loan would be satisfied if either of us is living in one of the units?
Any help would be much appreciated. I am very new at investing. :)
Rental Property Investor · Houston, TX · Member since 2017 · 12 posts · 2 votes
9y
Thanks, @Eric Guiltinan! Definitely not trying to cheat the system. Just trying to figure out how much flexibility there is in the FHA loan stipulations with multiple individuals on the lien :).
Thanks for the advice, @Michael Cohen! I have a younger brother who will be starting college in Austin in a few months. Perhaps I can list him as a co-borrower on the loan and have him occupy one unit? Just wondering out loud now.
Investor · Mission, TX · Member since 2017 · 220 posts · 135 votes
9y
Syed Rizvi I would tread carefully. FHA is actually quite inflexible- the only loophole I've read is in the language for the regs it says the owner must occupy the "majority of the year" to me that's 6 months and a day. Not sure if my logic would work, but I would be very careful. Your brother sounds like a great option!
Austin, TX · Member since 2015 · 40 posts · 33 votes
9y
@Michael Cohen thanks for correcting me. @Syed Rizvi, buying a place with your brother sounds like it could be a good idea. Buying a place for yourself and using your brother (or your friend) as a way to get a low down payment loan to go through sounds like a bad idea.