House Hacking as a New Grad

[Albert Gumbs]

Hey everyone,

I'm a senior in college right now (22 years old) and I'm interested in starting my investment journey in Maryland (PG or AA County area) with a house hack. I'm planning to start working full time in January and was planning to invest around June, and I'm wondering if I would be disqualified from an FHA loan due to not having 2+ years of income.

Also, I'd be open to other financing recommendations that might fit my profile better.

[Jack Seiden]

Quote from @Albert Gumbs:

Hey everyone,

I'm a senior in college right now (22 years old) and I'm interested in starting my investment journey in Maryland (PG or AA County area) with a house hack. I'm planning to start working full time in January and was planning to invest around June, and I'm wondering if I would be disqualified from an FHA loan due to not having 2+ years of income.

Also, I'd be open to other financing recommendations that might fit my profile better.

The two of income is waveble if you were in school the past few years in most cases and are fully employed whether your income out of college is enough to qualify and/or buy anything decent is another question. But purely from a financing perspective a w-2 plus college experience should be sufficient.

[Andrew Postell]

@Albert Gumbs I purchased my first house hack while still in college.  So, yes, it is possible depending on how much you make and what price point you are wanting.  My first property was $50,000...that may not be for everyone but it was a great property.  Just about any loan officer can tell you what is needed to qualify (and it should be free to do) and you'll need a realtor as well when the time comes.  I would recommend that both of these are local to you.  It's not fool-proof but that will help with most things if you are using local people.

Hope all of that makes sense!

[Jeremy H.]

So why do an FHA loan? Unless you put down more than 10% - congrats you're stuck with PMI for the life of the loan. FHA is one of the biggest crocks out there

Look for a first time home buyer program - I owned 4 rentals before buying my primary and I put 5% down on my primary. Find the right lender who can do 3-5% down for you. There's many of them that can do it no problem - "first time home buyer program"

As far as getting qualified and approved - going to depend on your credit, W2, downpayment and lender. Get to know some lenders - lots of them. Find out what they can do to help you. Find out what you need to do to get qualified and approved. 

There are many different loan types out there as well - if one doesn't work, another may. Learn about them. Ask the lenders about them and help them decide which would work best for you. 

Create a spreadsheet and run some numbers - get comfortable with it and make sure the numbers work. Both with you living there and with all units rented out (you will inevitably move out at some point and you want to ensure it will still work at that point)

[Albert Gumbs]

Quote from @Jeremy H.:

So why do an FHA loan? Unless you put down more than 10% - congrats you're stuck with PMI for the life of the loan. FHA is one of the biggest crocks out there

Look for a first time home buyer program - I owned 4 rentals before buying my primary and I put 5% down on my primary. Find the right lender who can do 3-5% down for you. There's many of them that can do it no problem - "first time home buyer program"

As far as getting qualified and approved - going to depend on your credit, W2, downpayment and lender. Get to know some lenders - lots of them. Find out what they can do to help you. Find out what you need to do to get qualified and approved. 

There are many different loan types out there as well - if one doesn't work, another may. Learn about them. Ask the lenders about them and help them decide which would work best for you. 

Create a spreadsheet and run some numbers - get comfortable with it and make sure the numbers work. Both with you living there and with all units rented out (you will inevitably move out at some point and you want to ensure it will still work at that point)

 Thanks Jeremy, I appreciate the info!!

[Benjamin Sulka]

Albert, 

Welcome to Bigger Pockets! 

Talk to some local lenders and see what programs they offer! You could also start by finding an agent who is familiar with the strategy you are looking to pursue and they should have some lender recommendations. 

All the best! 

[Ryan Thomson]

Almost certain you can use college as "two years of income" if you get a W2 job in a related field. Talk to a lender that understands what you are trying to do!  

[Conner Olsen]

Quote from @Albert Gumbs:

Hey everyone,

I'm a senior in college right now (22 years old) and I'm interested in starting my investment journey in Maryland (PG or AA County area) with a house hack. I'm planning to start working full time in January and was planning to invest around June, and I'm wondering if I would be disqualified from an FHA loan due to not having 2+ years of income.

Also, I'd be open to other financing recommendations that might fit my profile better.

I used 'college' as a way to get my first house hack 18 months after graduating. Ask your lender!

[Jake Andronico]

@Albert Gumbs

Congrats on thinking this way so young man. It has completely changed my life after only 2 house hacks. 

Definitely a lender question. They'll tell you what you need to know, and I'd recommend talking to at least three. 

Just because you speak with them, doesn't mean you're committing to anything. Don't be afraid to ask.