USDA Loan to FHA Loan

[Tony Moreno]

Hi Guys,

Newbie here in Real Estate. I have a question...

I purchased my first primary home 2 years ago with an USDA Loan, since I am now jumping into Real Estate, I am wanting to house-hack a multi property using an FHA loan, and at the same time rent what is now my primary home. Therefore having 2 or more units in this transaction. Do you guys know how to transition from USDA to FHA loan? Is it just like going from one one home to the other obtaining an FHA loan with a low down payment or is there more to it?

Any answers would help. Thank you very much in advance. 

[David M.]

@Tony Moreno

I honestly don't understand your question.  I'm wondering if you aren't quite sure what you are asking...

If I may start off this way:  Each property is its transaction.  The next property you purchase doesn't care what loan product you used previously.  There isn't any sort of transition.  All you do is get your financing prepared (i.e. talk to a loan officer and get your pre-approval letter --- basically) with whatever loan product makes sense.  Then, make an offer on a property.  Meanwhile, your prior property transactions stay untouched.

I second what @Jaysen Medhurst said about getting a conventional loan, usually as low as 5%. If your credit score is very good (which it needs to be now for a Government backed loan), usually the PMI is cheaper via the private market vs. the "gov't market." As he says, it skips all the Government extra checklsts to close and you don't have to refinance the loan to remove the PMI (yes, refinancing is basically how your change your loan...).

I hope this helps.  Please let me know if I misunderstood you.