House Hacking Small MFH, Current Primary Residence is a SFH

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Hi BP!

Question for the community...I currently live in a SFH with an FHA on it. I am looking to house hack a 2-4 unit where I would live in a unit, rent the others, and turn my current residence (the SFH) into a rental. I'd love to do a conventional loan with 5-10% down but have talked to a few local lenders that essentially said it would be impossible with less than 20-25% down because banks would not believe the multi fam would truly become my primary after living in a SFH. I was slightly discouraged after speaking with the 2 of them. What are your thoughts ?

I was also considering refinancing my SFH out of the FHA so that I could potentially FHA again, but not sure that helps my situation at all.

Thank you and look forward to the feedback!

FHA isn't just for FTHB, but it also isn't really investor friendly past the first property. To wit, unless certain very rare criteria are met, FHA will not allow you to "count" departing residence rental income, so your day-job income and the income from the new property would have to entirely support the new property AND the old property. However, typically, if your day-job income was strong enough for that to work, then you'd have 20% down.... that's not a rule, that's just how it most often plays out in my market.

If you want to stick to the low down payment options, 5% down conventional on a primary residence SFR that you will live in for 12 months, rinse and repeat every 12 months and a day. Generally conventional loans WILL count new departing primary residence rental income, and the "but it needs to have 25% equity" you will sometimes find online is old/inaccurate info, that's no longer a requirement.