First property: recourse vs non-recourse loan?
I'm looking for a lender who can offer a conventional loan on my first investment property (a duplex) for buy-and-hold in NC. A local lender offered what I think to be a recourse loan (I will verify it tomorrow) at:
- 30 years fixed, 20% down, 5.5% rate, no points. Or 5% rate with $2,500 in points, or 4.375% with $5,000 in points. As I understand it, this is a non Fannie Mae loan and thus - recourse.
Another national lender offers a Fannie Mae non-recourse loan:
- 30 years fixed, 25% down, 5.375% rate with $374 in points, or 5% with $1,571 in points.
I was told by the second lender that Fannie Mae loans for multifamily investment properties start from 25% down.
Is it worth paying extra 5% in downpayment and slightly higher rates for a non-recourse loan which guarantees them not going after my assets except the property as collateral in case of a default, - or - lower down and somewhat better rates but with a risk of them going after my W2 wages etc in case of a default?