House Hacking Question - Loan Types and Legal Entities

[Brandon C Abney]

Hi everyone, I'm new to Bigger Pockets, and I have a few questions that I'd be quite interested in getting some opinions on.

For a little bit of context before I get started, I'm a college student in Louisville, KY with an internship that pays me quite well, so I'll actually have a significant amount of money saved and invested in index funds by the time I graduate.  I'm interested in using some portion of that to house hack once I know what city my first full time job will be in.

My first concern is, I often see it recommended that people should use a low down payment loan, such as an FHA loan, to purchase a small multifamily property to house hack, but this seems like an excessive amount of leverage to me. I'm not loving the idea of buying a property and only having, say, <5% equity in it. Is the best solution to this to simply find a better deal so that I can gain some equity at the buy?

Secondly, I would like to transfer whatever property I purchase over to an LLC at some point after I move out, but I'm a little confused by some of the explanations I've heard regarding this process. More specifically, can this be done legally without triggering the "due on sale" clause in the original mortgage?

I feel like house hacking would be a great way for me to get started in real estate.  I just want to make sure I have my ducks in a row before attempting to move forward.

Thanks in advance for any advice you may be able to offer me.

Brandon