FHA 203K for multi or single family property

[Account Closed]

Hello...

I plan on using a FHA 203K loan to start my real estate investing business due to lack of capital for a 20% down payment plus rehab costs. My initial plan was to purchase a 2-4 unit multi-family, live in one unit, fix-up the property, and move out at some point in the future.

Should I also consider this strategy with a single family property? In this scenario I would fix it up and live in it until enough equity is built up to refinance. I would then rent out the house and purchase another property (single or multi family) to repeat the process.

How long would I have to live in property #1 before getting out of the FHA loan and is this a viable plan to get my foot in the door?

[Bill Gulley]

I suggest you first find a lender doing 203Ks, from a lender's point of view they aren't popular. You'll need to stay in property # 1 for at least a year.

Your second will be tougher, if it appears you're forming a pattern of investing you'll likely be denied. There needs to be a reason for moving, like change of job to another area. You won't be knocking out owner occupied loans on duplexes as a business model IMO. :)