Financing a 6 unit apartment complex

[Matthew Lynch]

Hello all, so this is my first post here. My realtor came across a 6 unit complex coming on market soon. The number check out and all looks good. Only issue is financing. They are asking 475k and I don't have anyone who is willing to go in on 20% with me. Now my realtor suggested if I could find someone to move into the property it would only be 3% down. If I could have my wife "move into it" would that work? Then transfer the property into my LLC? "I'm still in the mix of getting it set up" that leads me to my next question reading the how to invest in real estate. It says that you can't get a residential loan for units over 4. If my wife were to "move in" would that be an exception. What are the risks in doing that? Thanks in advance!

[Jacques Ikolo]

@Matthew Lynch

Hey, most people do not know this but for FHA loans you CAN purchase a 5+ unit. You just have to decommission the units and bring it down to "4". In your case, you would have to decommission 2 units. You wouldn't be able to rent out the 2 if the 6 units until you refinance out of the FHA loan. Talk to a lender on their requirements, but most of them require either to remove the kitchen appliances and/or knock down a wall so that the two units are "duplexed" or combined with another unit. Totaling it up to 4 units.

EX) If the six unit building has 1 bed 1 bath each, you'll combine them to have two units that are 2 bed 2 bath and two units stay 1 bed 1 bath.... And there you go, you have a 4 unit building that is FHA approved.