Best Loan Strategy First-Time Homebuyer

[Chris Platis]

Hi BP! First-time homebuyer here. Circling in on a 2-family at about $200,000. The home needs a minimum of $50,000 in renovations. I am approved for $300,000 and will owner-occupy 1 of the units. Below are 3 loan possibilities that I am circling, I just wonder if anybody has any insight or preference. 

• FHA with 3% down PROS: low down payment, great interest rate, keeps cash in hand for renovations. CONS: PMI forever (yes I know refi is possible to get away from PMI), tougher closing process (to my knowledge), 203K renovation loan is ruled out, none of 4 lenders seem to work well with the program, only local lender that seemed excited about it approved me for way less than required.
• Conventional with 15% down PROS: No PMI forever, more equity in home, potential to bundle in with traditional renovation loan CONS: Higher interest, more upfront cost
• FANNIE MAE HomeStyle with 5% down PROS: PMI not infinite, keep cash in hand while having access to funds for renovations. CONS: unsure really as most lenders are seeming to sway me to either FHA or Conventional.

My thoughts originally were to go FHA as it is my first-time home, but I'm beginning to feel more deterred by it. I am intrigued by Fannie Mae loans but not getting as much info as I'd like on them despite shopping through multiple lenders, both local and larger. I like the seeming simplicity of a conventional loan. Assuming that I have the funds to cover the cost of renovations, I am just wondering what would be the best way to finance this home and complete the necessary renovations.

Any thoughts, advice, experience, or questions are greatly appreciated. 

Thanks! 

Chris