Best Loans for REI

[Hajarah Shakir]

I’m just starting out in real estate and I am looking to house hack a multi family in Massachusetts. I have around $40k saved for a down payment. Would rather put as little down as possible just Incase I need to rehab / repair . what is the best loan possible to get started ? Also what exactly will a mortgage broker do and do I need to personally get one ? Looking to buy next year in 2021

[Tyler Lynn]

Hey Haharah, 

This is the exact strategy I used to take down my first property when I was getting started out. Your best bet is an FHA loan, this will allow you to put as little as 3.5% down, and get up to 4 units. With putting just the 3.5% down, you will have the remaining capital for an expense account as well as some money to renovate if it is a property you believe you can add value too. You do not need a mortgage broker, but you may want to get one. Mortgage brokers will shop the best rates from different banks for you to try and get you the best rate, but their fee will be worked into the closing/loan cost so it isn't necessarily cheaper. If you have the time to shop rates and create relationships with lenders then you should do it yourself, mortgage brokers can be valuable, but doing this on your own can give you experience, knowledge and future relationships with lenders.

Thanks,

Tyler