First time FHA loan questions and advice

[Michael Morris]

Hi,

I am looking to move into an owner occupied duplex with an FHA loan. I know you can put only 3.5% down but my first question question is if I have enough saved up for 25-30% down will I have to put a higher amount down? Second, If I can only put 3.5% down should I? Ideally what I am looking to do is put 10-15% down, ill still have more than enough for repairs/updates, plus enough leftover for saving for a downpayment after a year of owner occupancy. My thinking is why put only 3.5% down and have all that extra money sitting in my savings account earning a measly return for a year when I can put 10-15%, make repairs/improvements, and have enough leftover that after my savings/earnings of a year of owner occupied I will easily have enough for another purchase. I'm I missing something/not seeing the benefits? Is it better to do the 3.5% down and have the extra capital sitting in savings for a year?

Hope this all makes sense. I'm new to this and am trying to put it all together. All and any advice is much appreciated!

Thanks!

[Andrew Acuna]

Michael Morris good question. If you're going to do anything more than 3.5 don't do an FHA. If you have 20% and it works out with your other numbers avoid the PMI and go conventional. It really doesn't benefit you at all to put 10-15%, other than the lower payment. I would buy the first one conventional (5% down I believe), then shortly after buy another property or two.