Can you use a FHA loan for 5+ units under $1m?

[Mason V.]

There's a set of 17 units where I live priced at around $750k. Under the Terms section of the ad it states "cash, conventional loan or FHA Loan and seller is willing finance 2nd.” That all sounds great except for the FHA part. For the past two days I’ve done FHA research and from what I can tell this place does not qualify. From what I’ve seen the property needs to be 1-4 units for owner occupied. For 5+ units the property just needs to be a minimum of $1m. These are for 2 separate types of FHA loans and from what little I have this property does not qualify for either. I emailed the listing agent about this but she has not yet returned my email. Nor had the Portland FHA office contacted me after I left them a message. So now I am asking the Biggerpockets community.

[Ben Leybovich]

FHA does have commercial products. Not many people know about these. I don't think that anything under $2 mil is doable. Also, I don't think that carry-back second is going to work with them. Finally, these are pretty difficult programs in terms of reporting and withholding of CapEx, etc.

I'd forget FHA on this. Good luck!