All Forum Posts by: Nicholas Sheridan, Jr.

@Brian Garlington That is a really good point, I had no idea about that restriction. I will definitely add that to my pro/con list. Thanks!

@Harjeet Bhatti What do you mean by "product"? 

@Harjeet Bhatti Thanks for the response. I have not run the numbers yet but that is on my list of things to do! I think I need to do more looking around for different rates/terms.

@Marcus Lawson Thanks for the response. I agree, I think I would be paying more with the conventional. I have heard great things about FHA first time buyer incentives.

@Johnathan Boyle Thanks for the response. That was my exact thinking as well, I would have money available to do the other deal. I am starting my market analysis this weekend and will be going through the pre approval process after that. 

Hey everybody. I want to start looking at financing for a fourplex property in NJ and I am stuck on the fence between FHA or Conventional financing. This would be my first time buying a house and I am looking to house hack for at least 2 years and purchase a $400-450k property. I would be able to put down $40k and another $5k for closing costs. So far I have gathered:

FHA

Pros: 

• Low 3.5% downpayment

Cons: 

• PMI
• Required to live in the house
• Can only have one FHA loan

Conventional

Pros:

• No PMI once you hit 20% equity, or find a bank like Trustco Bank which doesn't require PMI

Cons:

• Usually higher interest rates
• Higher downpayment

Another thing to consider is that I am working full time right now and I have about $30k in student loans left to pay off (estimated $400/month). I was originally leaning towards the conventional because of the lack of PMI payments but now I think I should do FHA because I would like to purchase another property within a year after this purchase. Any recommendations? Thanks

Welcome @John Fortes ! If you are just getting started I would take a quick read through the Bigger Pockets Ultimate Beginners Guide in addition to listening to the podcasts related to HELOC (home equity line of credit). I think that is a good idea depending on the % equity you have in the home. I am not sure what the order of events should be so I don't want to feed you false info, I'm sure others who have more experience with HELOCs will chirp in.

@Julian H. Same here. Going to house hack, buy a multifamily and live in one unit and rent out the rest.

@Christopher E Renna Welcome to the BP community! I am also curious about the profitability in North Jersey with such high property taxes.

@Julian H. Welcome to BP! I am in the Linden, NJ area and currently work full-time. Also, I have been studying all that BP has to offer for about 6 months. Sounds like we are in a similar boat! Have you narrowed down your REI options (flipping, multifamily, etc.)?