How are all of you getting 20 percent down on investments?

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Committing mortgage fraud by attempting to use an FHA loan for an investment property purchase under the misnomer, that "will anyone ever really know" would certainly qualify for "doing something dumb", so I am telling you, DON'T do it! Yes, people will really know. The first person will be you! Your original question was how do people get the 20% down to buy investments properties? They work hard and save money...they partner with others and pool resources...they work second jobs and save money....they find distressed sale opportunities and work something out with the seller for some level of seller carry. These a re just a few ways to do it. None of them are illegal and none of them can have you looking at a felony conviction for bank fraud, wire fraud, fraud by deception and a whole host of other not good things that are used to punish people that get caught making fraudulent applications for loans. It's sad that over the last couple of decades, there have been a lot of hucksters in and out of this industry that have advised, guided and provided assistance to people to do just that and a lot of them never had any repercussions befall them for doing so. I can assure you that a whole lot of people did though. It's like any other crime (yes...it's a crime!...not creative financing)...some get away with it and some get caught.Do it the right way. Anyone that advises you to do it the wrong way, you should immediately not do any type of business with moving forward. There are a lot of people on BP that will give you the best advice they can (I'm one of them) and there are others that will give you bad advice. It's up to you to decide which advice to follow. Sometimes the best advice is not the easiest to follow and it takes longer to achieve your goals by following it. But the bad advice will ruin you...at some point, just like all bad advice does.Good luck.

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Welcome. You have already set yourself up for success by joining BiggerPockets!! This is really the premier place to start learning about RE and what it can do for you!Yes, most investment properties will need 20/25% down. You could use an FHA loan and owner occupy..?? but..1. First things first, learn the basics --> http://www.biggerpockets.com/starthere2. Then, download the BiggerPockets Ultimate Beginner's Guide and start reading some more!!The UBG will will walk through many of the key topics of real estate investing. Ask anyone here, its an invaluable resource. --> https://www.biggerpockets.com/real-estate-investin...3. Once that's done, get to listening to the free BiggerPockets Podcast - A really great podcast with interviews and a ton of great advice. --> https://www.biggerpockets.com/renewsblog/category/...4. Now you're ready to face the RE world !! GO GET IT!!

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FHA guidelines changed, PMI remains for the entire loan duration now. Hope this helps.

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* I just did an 85% LTV for a client recently.

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Bradley Pietrzak , first and foremost like everyone else says here-do not commit fraud! The most prevalent fraud in mortgages is occupancy fraud. It is not worth you going to jail or be fine a $1M or both for committing fraud just before you even start with your RE business. Do it right. That said, you can own an investment property using conventional financing with 15% down. You will be subject to paying PMI for the life of the loan. I just did You can also purchase a duplex or any 2-4 unit properties using FHA financing as mentioned above. That only requires 3.50% but you need to have 3 months reserves, etc. That could be one way for you to buy your first home and also have the other units cover your mortgage. Perfect for singles or small family. There are as many successful participants have said here multiple other ways of buying an investment property using alternative financing options. This is the space to learn it. I'm in this boat and I've finally decided to start reading and get serious about learning more about the alternative options. Good luck.

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@Jay J. - 20% down investment property loans for SFRs have super ugly rates. Frankly I do not like quoting it because I don't want to get a reputation for having jacked up rates. The FNMA LLPA is 337 to 412 basis points, instead of the 212 basis points that 25% down will get you. If someone walks in and specifically asks for it, or really only has 20% down, I'll quote a 20% down rate, but otherwise I roll with the general impression everyone has that 25% is 'required' just because I don't want my reputation to be trashed.

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Haha Boy, quality and magnitude of expectations has really come down on BP, hasn't it?!?Not too long ago people were asking - how are you all getting $0 investments? Now it's 20% lolI wonder what this says about the marketplace and BP...

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I wouldn't do anything shady but keep doing what it looks like you're doing which is researching and you will find some way to get it done.I was was looking at a 4 plex in the SF Bay Area and was told 25% down as well.I couldn't come up with the 25% without pulling from my 401 or equity so I went another route and am looking at much cheaper properties with good cash flow so sometimes changing tactics works as well and you learn new things.

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@Jon Bachman you are right. The FHA PMI is now lifetime. Once you get enough equity, you can either keep it as is or refinance conventional to get rid of PMI.@Bradley Pietrzak please try to use punctuation and capitalization. Maybe I haven't had enough coffee yet, but it's nearly impossible to understand what you are typing.Basically, do not commit mortgage fraud. It you want to find a 20% down loan product, call banks and credit unions and ask if they have it! They do exist, just call around. You said the property is far. If it's another state then make sure the banks you talk to lend in that state.

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You might want to check with some of the Credit Unions, like Wings, to see if they have a loan product that will work for you. Some of the smaller guys that hold, and or service, their own loans can be a little more flexible.