Calling all those with House Hacking Experience

[Jam Jackson]

Hi all!

Newbie investor here. Some questions have arose for me after doing some reading, podcast listening, and property analyzing.

For those with house hacking experience (especially with FHA financing) - based on your experience(s)....can you answer these questions?

1. What are ways to continue house hacking with FHA financing given the 1 loan rule?

2. Has any one house hacked multiple times? What was that experience like? How was that strategy beneficial in helping you reach your REI goals?

3. So in doing property analysis I know we're supposed to account for all projected fees (including vacancy, maintenance, etc.). In house hacking - if a tenant's rent fully covers mortgage, taxes and insurance (or most of it) - do you save money from your W-2 job to account for the other projected expenses (vacancy, maintenance, PM, CapEx)??

Answers to any of these questions are greatly appreciated!!!

Thanks (metta)

[Jim D.]

Hi Jam, I house hacked multiple houses. Mine were single family houses, and I used 5% down conventional loans. (I negotiated for the sellers to pay up-front PMI so I didn't have that). However, if you're doing multi-family, conventional will require at least 20% down (unless you qualify for the HomePossible program). Here are answers for your questions:

1. I've heard of someone buying an FHA multi-family as a primary residence that needs work. They move in and rehab while they live there. Then they refinance into a conventional loan at 75-80% LTV, freeing them up to purchase a second property with an FHA loan. It's not easy to force that much equity in a short time--you would either need to buy at a great discount, do rehab, or put extra money towards to the principle to get to the point where you can refinance out. Not easy, but possible.

2. Best thing I ever did. Great way to build a portfolio quickly with limited capital. I was paying for my wife's medical school costs, and just couldn't save up for 20% down at the time. If I had waited to save 20% down, I would have just last year purchased my first property. Instead I have well over $1M in my portfolio.

3. Yes.

4. Sung got it right for tax benefits.