How to purchase a duplex, triplex, or quadplex?

[Young Kim]

Hi, I am living in Southern California at the moment. I am currently unemployed because I resigned from my previous company and decided to pursue my career in real estate. I am studying for real estate license exam and looking for a job in a related field. The question is, I am trying to see if I can purchase a duplex, triplex, or a quadplex, but I do not have a job yet. As far as I know, it may be easier for me to qualify for a conventional loan once I get a job, but I wanted to see which options I might have out there. I will explain my financial position and situations here. Please give me advice on what type of options I have out there in order to purchase a duplex, triple, or a quadplex. By the way, I am looking for them in California or Texas (Dallas area preferably). 

*I am currently unemployed.

I have about $38,000 in cash and I have about $65,000 in equity invested in stock market (portion of them are sitting there in brokerage accounts as cash). So if I liquidate my equities, I can pull off maybe about $103,000. However, that is all I have and I do not wish to invest all that money as it can be risky. I am thinking to put down about $50,000 ~ $60,000. 

Question: With my employment status, and financial position, what options do I have? and would I even be able to afford a duplex with that amount? I am currently looking for a job, but I believe that my starting salary will be around $30,000 ~ $40,000 since I do not have any experience in this field and I do not have my license yet. 

Please let me know if you need me to answer any of your questions in order for you to give me a better advice. 

Thank you very much in advance!!

[Jonathan Steiger]

@Young Kim if you go through a bank using a conventional loan or FHA loan you will have to wait until you have a job.

I'm not familiar with the California market at all but I obviously know it's very expensive. 38k is a decent chunk of money to start with. I would suggest going the FHA route and living in one of the units. You only need to put 3.5% down. If you found a quad for say 600k, you could put 21k down and have enough for closing costs. Avg FHA rate in California is 4.79%. Monthly mortgage payment would be $3144. Like I said, I have no idea what rent would be there. Let's say $2500 per unit. 50% goes to expenses (not including mortgage). So 5k to expenses, $3144 to mortgage. In this hypothetical example you would get $7500 a month in rent. Expenses of $8144, meaning that you would be paying only $644 a month for living expenses. You will also be getting the benefits of real estate ownership which include cash flow, loan paydown, tax benefits and possibly appreciation.