Trying to find a way to finance a duplex without 25% down

5 Replies

My name is Carnell from Cleveland Ohio and I am new to BP. Im looking for some advice on how to finance an investment duplex without putting 20%-25% down. Unfortunately I bought my SFH before I knew about house hacking strategy. I have a fha mortgage (3.8 interest rate) on my current home that I've been living at for about 16 months, so I fullfilled the owner occupancy requirement. I live with my gf, but I am the only name on the loan. Any way I can use this to my advantage to maybe owner occupy a duplex using her name? Or are there any other ways to get my portfolio started?

I wouldn't go in on a house with a "girlfriend", that's a bigger risk than using an FHA loan IMO.

Yea I plan on living there for at least a year. I'm just trying to figure out should I rent my current home or try to sell it. The only problem is I don't have enough equity to refinance into a conventional.. Also even if I did, my interest rate is lower than the current rates.

I would agree with @Peter T.  

You can pull out a HELOC (Home Equity Line Of Credit) Or a Home equity loan on your SFH, and use that money towards a downpayment. That's what I did. Just make sure you have a good exit strategy and that you can pay it back as soon as possible. This can be done by rehabbing and refinancing.

HELOC is usually interest only for the first ten years with an adjustable rate, whereas a Home equity loan is both interest and principle payments.

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