House Hacking

[David Cochran]

I want to buy a 4plex, live in one unit and rent out the others. The problem is my income is too low to qualify for a very big mortgage (maybe $165,000). I have $20,000 that I would like to use as a 5% downpayment on a $400,000 owner occupied 4plex. My question is, can the rental income of the property help me qualify for the home loan that I need? 

[Clay Manship]

Simple answer--yes. Underwriters will count the income of the other three units IF they are currently occupied and producing income. Some will want to see that the income has been coming in steadily (called a seasoning period, or seasoned income) before they count it, but it certainly happens. Find a loan originator who has done it before and understands where you are coming from--it will do wonders.