First time buyer status gone if I own an investment property?

[Scott J.]

Hello all,

So I'm in a bit of a dilemma here. There's a property for sale at a good price that I think would be a good opportunity to start the REI journey with. I also want to buy a house to live in for myself and take advantage of the various first time home buyer programs as well. My question is, if I were to buy the investment property first will I still be considered a first time home buyer when I buy a house to live in? By definition, a first time home buyer "is an individual who has not had an ownership interest in a principal residence (anywhere) for the previous three (3) years." I won't be living in it so I'm assuming that I won't lose it. What do you guys think?

[Chris Mason]

No, you wouldn't be a FTHB any more. But, so what?

Do you want to take 4% down payment assist, and 5% for your rate on an owner occupied property, or do you want to take 5% DPA and take 5.5% for an owner occ 30 year fixed? Oh, and there's penalties if you refi within 3 years. All of a sudden, there's not too much "special" about the "FTHB program" is there? :)

This is one of the two most commonly used DPA programs in my state, California,  but it's basically the same everywhere. There's no "free" money.