First time home buyer

[Raven Walker]

hello, so I currently live in an apartment and looking to buy my first home which will be a multi family, I've heard the horrible stories. But a little struggle never hurt anyone. So, I've been reading on first time homebuyers programs and basically it says that it has to be owner occupied for the lifetime of the loan. That is not my plan. I want to stay in it for at least 3 years. In those 3 years my goal is to get 2 more multi families 2+ units. Then of course move into a single family. My question is, what is the best financing? FHA or a standard loan? And anything else you could tell me would help. Thanks

[Jerry Padilla]

@Raven Walker

The only requirement is 1 year for FHA or Conventional so your 3 year plan will be fine to qualify for a primary residence. FHA has high mortgage insurance put it also only requires 3.5% down. So if you initially go this route, I would suggest refinancing down the road with conventional when you reach a 75% LTV to the current value of the property to remove the mortgage insurance. For a primary residence with conventional financing or an investment property with conventional financing here are the requirements:

Standard Conforming Limit Financing

For A Fixed Rate Purchase, Primary properties, Mortgages 1-10;

• A SFR requires a LTV of 97% (first home only) then 95%
• A Duplex requires a LTV of 85%
• A Triplex & Fourplex requires a LTV of 75% (possibly 80% with Freddie Mac - on mortgage #1-6)

For A Fixed Rate Purchase, Investment properties, Mortgages 1-6;

• A SFR requires a LTV of 85%
• A MFR requires a LTV of 75%

For A Fixed Rate Purchase, Investment properties, Mortgages 7-10;

• A SFR requires a LTV of 85%
• A MFR requires a LTV of 75%
• A minimum credit score of 720