Just don't 'get' the Financing thing

[Stephen Sparks]

Hi everybody.Maybe I'm a dummy but could you explain the Financing thing to me.

Let's say I save $10k. I get a FHA loan for a duplex. I house hack one unit while renting the other. So far so good.

The only way I see this working is to pay off the mortgage, take a new loan with house 'A' as collateral and buy house 'B'. That will take more time than I have. How do I doped the process up?

Thanks in advance

[Christopher Phillips]

@Stephen Sparks

Welcome to BP...

You're thinking correctly. 

You buy one 2-3 family, live in one unit while the tenants pay down your mortgage.

Where you're mixing things up is that you don't have to pay off the entire thing. Just build up enough equity so that you can then use a HELOC to draw down cash and then go buy another rental property.