Analysis of loan types for MF properties

[Tyler Gilbert]

Hi all. I have been doing some research into MF properties and have had some extremely informative conversations with some lenders and agents (Thank you Rick, Jonathan, and Jake). I’m interested in learning more about any positive or negative experiences from investors on differing loan types . Right now the options most applicable to my situation seem to be:

• FHA 3.5% down
  1. I was informed of the higher PMI payments and the negative connotation when looking at MF properties in Northern NJ. This is a possibility for me due to the low down %, although I'd need to include closing costs and other fees.
• Conventional 5% down
  1. This seems like a possible better option due to the lower PMI payments and potentially lower rate. Fannie Mae's 5% MF loans seem perfect for this even though I'd have to prepare a higher down.
• NJ State down payment assistance and a NJHMFA mortgage loan.
  1. This is enticing due to the $15k down payment assistance and additional $7k first generation program. However, I have not heard of how the loan rates compare to the more frequented options.

Context: First-time young homebuyer. High credit score. Low capital prepared but currently building up. Looking in northern NJ to househack.

Thanks all for your thoughts and feedback.

[Robin Simon]

Quote from @Tyler Gilbert:

Hi all. I have been doing some research into MF properties and have had some extremely informative conversations with some lenders and agents (Thank you Rick, Jonathan, and Jake). I’m interested in learning more about any positive or negative experiences from investors on differing loan types . Right now the options most applicable to my situation seem to be:

• FHA 3.5% down
  1. I was informed of the higher PMI payments and the negative connotation when looking at MF properties in Northern NJ. This is a possibility for me due to the low down %, although I'd need to include closing costs and other fees.
• Conventional 5% down
  1. This seems like a possible better option due to the lower PMI payments and potentially lower rate. Fannie Mae's 5% MF loans seem perfect for this even though I'd have to prepare a higher down.
• NJ State down payment assistance and a NJHMFA mortgage loan.
  1. This is enticing due to the $15k down payment assistance and additional $7k first generation program. However, I have not heard of how the loan rates compare to the more frequented options.

Context: First-time young homebuyer. High credit score. Low capital prepared but currently building up. Looking in northern NJ to househack.

Thanks all for your thoughts and feedback.

 When you say "MF" - are you referring to Multifamily and more specifically 2-4 units?  Generally "multifamily" in real estate will tend to mean 5+ units, but if looking for 2-4 units your current options that you listed are pretty good - but would not apply to anything bigger by unit count