Best type of mortgage for 1st time buyer, multi-property house?

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Best type of mortgage for 1st time buyer, multi-property house?

Guillaume Fortina
Chicago, IL · Member since 2017 · 4 posts · 0 votes

Hi BP Community!

For (a) a 1st time home buyer, (b) looking for a multi-family property, (c) hoping to get a lower down-payment... what would you say is the best type of mortgage out there?

(I have heard of FHA; regular mortgage with 20% down, regular mortgage with less than 20% down; Home Possible loans by Freddie Mac; HomePath loans by Fanny Mae...)

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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
8y
Guillaume Fortina - assuming it’s under 5 units there are a lot of options and it depends on your down payment you want to put down. If you can put 20% down to avoid PMI that would be my recommendation as it lowers your cost and gives you equity in property in case the market begins to slump
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  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    8y
    Guillaume Fortina - assuming it’s under 5 units there are a lot of options and it depends on your down payment you want to put down. If you can put 20% down to avoid PMI that would be my recommendation as it lowers your cost and gives you equity in property in case the market begins to slump
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  • Jeff Dulla
    Lender · Western Springs, IL · Member since 2015 · 472 posts · 245 votes
    8y

    @Guillaume Fortina you pretty much summed up the best options. What specifically are you looking for beyond what those programs provide you?

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  • Andrew PostellPro Member
    Lender · Fort Worth, TX · Member since 2016 · 8k+ posts · 6k+ votes
    8y

    @Guillaume Fortina yes, FHA allows 3.5% down with a multi-family unit property, and those Fannie/Freddie types you mention allow 3% down. You can't make too much money for those Fannie/Freddie loans but in some cases income doesn't matter if the property is located in a certain area. My recommendation is to interview a few lenders in your area and ask them about those loan options. Let us know if you have any other questions. Thanks!

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  • Harjeet BhattiPro Member
    Lender · Glenview IL- CDLP NMLS#230554 · Member since 2015 · 2k+ posts · 747 votes
    8y

    @Guillaume Fortina FHA and Home Possible both are good program for 2-4 units. All depend which program fit your need and will profitable to you as an investor.

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