All Forum Posts by: Brandon Bell

I am trying to close on a 4-unit multifamily property using FHA lending through Lender A. My W-2 income alone qualifies me for the purchase of the multifamily property. The Self-Sufficiency Test does not pass the requirement (PITI ≤ appraised rent x 75%).

I got in contact with another Lender B who is telling me the self-sufficiency test is required only when you need the rent pay back to supplement your income as qualification for the loan.

I confirmed with the Lender A that my income alone does qualify me for the loan but they are telling me the self-sufficiency test is required regardless of your income qualifications.

Who is correct on this? I cannot locate the guidelines for FHA multifamily loan requirements anywhere online and Lender A cannot point me to the specific guideline that shows this requirement. Can you possibly even point me to a handbook or regulation (not an article) that highlights this?

That may explain why this was being inquired. Thank you for the feedback!

Again this is no longer applicable to my situation, but if I had friends living in my house (primary residence + single family) and they were fronting some cash to help with bills, would that be considered "rent" and taxed as income?

Although I find friends with experience and YouTube incredibly resourceful many regards, my accountant actually told me this (first time working with them)! We worked through the details and determined this was no longer applicable for my situation and therefor a moot point.

However it still begs the question, if an individual has the correct circumstantial tools in place could rent less than the FMV be non-taxable? If so, I'm curious to know what those circumstances are. It doesn't apply to me anymore but may help someone down the line!

My wife and I work on the road and have roommates who occupied the residence for the entire year of 2022. I was informed that as long as we were not charging over the FMV rental rate it would not be taxed as income. At the time I just got comps from our roommates who were seeing (apartment) rents for around $1,600. We charge them $1,500. I did not file this as income for the year 2022 since this is still our primary residence.

1) Is it correct that the rent must be under the FMV?
2) How do I calculate the FMV?
3) Would it help to have an agreement between roommates and us that we are charging less than FMV?
4) What other items should I consider?