Fannie Mae/ Freddie Mac vs. Private Lending
I am looking for lenders in my first House Hack. I want to know what the pros and cons are going to Fannie Mae for my loan vs the Private Lending route.
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#3 Personal Finance Contributor
- Rental Property Investor
- Denver, CO
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#3 Personal Finance Contributor
- Rental Property Investor
- Denver, CO
While there are exceptions to every rule, if you can, you want to use a QM loan (Fannie Mae or Freddie Mac insured) as a house-hacker. It's a huge advantage, will come with a 30-year fixed rate option, low interest rates, and low down-payment options.
I'd stay away from private money until you have a flip/rehab project that can add serious value, and is not a primary residence/house-hack. Private / hard money is a last resort, but an option used all the time by experienced flippers and rehabbers.
One other item - you might, as a house-hacker, want to research assumable mortgages. Can you take over the VA or FHA loan used by a homeowner selling a property, and take advantage of 3% interest rates on existing properties?
