House Hacking at 22 years old
I'm relatively new to the real estate investing business and wanted to start out house hacking. I've saved up about 35k and have really good credit with a stable job. I was curious if anybody is/knows a good lender that I could speak to about getting started. Many thanks!
Welcome to the community! It seems like FHA might be a good route to go if possible or conventional if your credit and down payment. Lower down payment requirements but you have to live in the property for a year, no big deal if you plan on house hacking for FHA. Most lenders should be able to have both of these loan products. The FHA process is a little more stringent since it's federally backed. I'd recommend going with a local lender that you have a good relationship with as opposed to a large national company as they are likely to have better immediate customer service and are more likely to respond in a timely manner, which is important for your first loan. I've noticed that credit unions tend to have slightly better interest rates since they typically are not for profit whereas a normal bank or broker is. Happy to be a resource if needed!
Quote from @Kiernan LaFaver:I appreciate you reaching out and thanks for the welcome! I actually managed to get a quote for a conventional loan recently, just so happens that the only thing holding me back at this point was my job. I work 30-35 hours a week at an OK wage, which wasn't enough to qualify for the amount I would need to buy a property from where I am. I'm working on getting a better job and possibly a co-signer, though I may look into the FHA loan as well in the meantime. Thanks Again!
Welcome to the community! It seems like FHA might be a good route to go if possible or conventional if your credit and down payment. Lower down payment requirements but you have to live in the property for a year, no big deal if you plan on house hacking for FHA. Most lenders should be able to have both of these loan products. The FHA process is a little more stringent since it's federally backed. I'd recommend going with a local lender that you have a good relationship with as opposed to a large national company as they are likely to have better immediate customer service and are more likely to respond in a timely manner, which is important for your first loan. I've noticed that credit unions tend to have slightly better interest rates since they typically are not for profit whereas a normal bank or broker is. Happy to be a resource if needed!
Quote from @Aidan Black:
Quote from @Kiernan LaFaver:I appreciate you reaching out and thanks for the welcome! I actually managed to get a quote for a conventional loan recently, just so happens that the only thing holding me back at this point was my job. I work 30-35 hours a week at an OK wage, which wasn't enough to qualify for the amount I would need to buy a property from where I am. I'm working on getting a better job and possibly a co-signer, though I may look into the FHA loan as well in the meantime. Thanks Again!
Welcome to the community! It seems like FHA might be a good route to go if possible or conventional if your credit and down payment. Lower down payment requirements but you have to live in the property for a year, no big deal if you plan on house hacking for FHA. Most lenders should be able to have both of these loan products. The FHA process is a little more stringent since it's federally backed. I'd recommend going with a local lender that you have a good relationship with as opposed to a large national company as they are likely to have better immediate customer service and are more likely to respond in a timely manner, which is important for your first loan. I've noticed that credit unions tend to have slightly better interest rates since they typically are not for profit whereas a normal bank or broker is. Happy to be a resource if needed!
Wow! I wish I got into Real Estate when I was 22 years old --- Good for you! Just some wisdom from someone double+ your age, I would save your money for now. We've bought and sold many homes and it can be a rough and scary ride when you are first starting out. I would not put my 35K at risk just get. Do a few wholesale deals or find a deal that is seller financed or a subto. You can also be a PML with a trusted investor and make some $$ with points and interest. Most important, I would not do it alone without some adult supervision. That money can easily vanish with a single oversight. HTHS! Joel
Hey @Aidan Black! What state are you looking to house hack in?
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Quote from @Grant Schroeder:
Hey @Aidan Black! What state are you looking to house hack in?
Preferably Rhode Island currently
Start your search for a trustworthy house hacking lender by looking at local mortgage lenders who specialize in lending to first-time buyers and real estate investors. Consult with friends, relatives, coworkers, and other real estate investors to get their opinions on various lenders. To evaluate the standing and dependability of various lenders, look for reviews on the internet. Make appointments to talk about your financial status, investing objectives, and borrowing choices with possible lenders. To choose the loan choice that best suits your financial objectives and preferences, compare options including conventional loans, FHA loans, VA loans, and down payment assistance programs.
Assess customer service by focusing on how helpful and responsive a representative is during conversations. Work with the lender you've chosen to be pre-approved for a mortgage. Your offer will be strengthened and your eligibility as a buyer will be shown with a pre-approval letter. Finding a trustworthy lender to assist you with the financing process and help you realize your aspirations of being a house hacker may be achieved by following these guidelines and doing extensive research.
Good luck!
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Awesome job on the savings and looking into the House Hacking strategy! One of the first things I would do is look up a list of local lenders that are in the same area as the home you're going to house hack. I've had some great experiences working with local banks / credit unions and would shop around there first before comparing against more national banks.
Looking for a Private Lender?? for 60 days?
That's fantastic! It's a great way to begin. I did the same thing with an FHA loan when I was starting out at your age 15 years ago. Despite having roommates for 2 years, I have no regrets about taking that step.
Hi Aidan,
House Hacking is our specialty, majority of our clients start with house hacking and our team also house hacks. Happy to answer any questions you may have about this strategy. Quick tips don't max out on your first property make sure you can at least break even once leaving that property or be negative as little as possible. The key is to make sure you can also get the max rent from your property and one way to accomplish that is to rent by the room instead of renting out the whole house to a family. In order to rent out by the room you will also have to make your property marketable for to rent out by room and this means location will be key as well. There's many ways to plan to make this work first thing is to find out how much you can qualify for and what are rents going for in your market.
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Get an FHA loan for a house hack. 3.5% down, and you can qualify up to about a million dollars in purchase price, but it depends on where you live. You can also use 75% of the other units to qualify you with your DTI. You will need 2 years of work history, but you can use college experience to supplement work history. I am not an FHA lender, but looking for one of these deals myself.
@Aidan Black there are few different down payment assistance programs in RI. There is one for a first time home buyer, one for first generation home buyers. I would do some research because if it is like the program in MA only certain lenders offer it. I am not sure if you have a downpayment how it works but it is important to see if you can get that boost. While FHA is great there might be something state specific that is better or just as good.
Hey @Aidan Black awesome to hear you are taking the steps to buy real estate at 22! House hacking is the best way to start to gain knowledge and to see first hand how to operate and manage a property while living in it. I started house hacking at 21 and has been the best decision ever! Im local and invest in RI now as well. I also suggest getting out to real estate events to network with other like minded people in real estate and learn as much as you can from others. So much value in networking. Im also hosting a real estate event on April 8th in Taunton MA if interested!
Join me at Real Estate Connections and Conversations https://meetu.ps/e/MVLcB/FJSv3/i
Whats up Aidan!!
House hacking is amazing! great way to set up your future. You can move into a new house hack every couple years and rent out your previous room and before you know it you have a fully operating portfolio. I am not 100% sure where you are from but I am a realtor/investor in MA and have great connections with great lenders if you want me to send you in the right direction!!!
Good Luck either way!