Rental Property Investor · Columbus, OH · Member since 2015 · 344 posts · 258 votes
Hello all,
I am currently researching properties for my first rental. I know I'm going to do a house hack and have been contemplating ways to reduce my initial capital as much as possible, as I have next to nothing available anyway.
I'm thinking of doing an FHA loan with 2.5% down and down payment assistance to cover that down payment. Has anyone had experience with this or have thoughts?
Yeah, I understood PMI would be a part of it if I went that route. But for having next to nothing into it initially, especially if you're just starting out, its a good way to go I think. Thanks for the input!
It's absolutely the best way to go. If I knew what I know now, back then, I'd house hack like crazy. Talk about building wealth for virtually nothing and living for free for as long as you can! Ask @Brandon Turner...I think he would approve...he's kinda obsessed.
I love this thought. Just keep in mind that only putting 2.5% down will require you have have Private Mortgage Insurance (PMI) on top of your home owner's insurance. Depending on the price of your property, this could be anywhere from $60-$200 extra monthly. However, if you can live for free and have someone else pay your bills, who cares??
Yeah, I understood PMI would be a part of it if I went that route. But for having next to nothing into it initially, especially if you're just starting out, its a good way to go I think. Thanks for the input!
Yeah, I understood PMI would be a part of it if I went that route. But for having next to nothing into it initially, especially if you're just starting out, its a good way to go I think. Thanks for the input!
It's absolutely the best way to go. If I knew what I know now, back then, I'd house hack like crazy. Talk about building wealth for virtually nothing and living for free for as long as you can! Ask @Brandon Turner...I think he would approve...he's kinda obsessed.
Haha! Thanks for the encouragement, Kyle. I've sort of always been a pessimist, so doing a no money down strategy like the one I'm contemplating just seemed unrealistic to me at first. But, one of the most important things I've learned in my research thus far is not I can't, but how can I?
The minimum amount down is not always the best option. Make sure you look at all of your down payment options, rates(included PMI) and points over time. Become intimate with Excel.