Will FAH allow you to convert 8 unit to a 4 unit?

[Soniel Estime]

My agent sent me a property that consist of 8 1bed 1 bath units. The units generate $400 a month no AC. Asking price is 270k.

I was thinking of house hacking with an FHA 203k loan and converting the units into 4 units or a 3 unit.

4 unit would be one 3bed 2bath two 2 bed 2 bath one 1 bed 1 bath.

3 unit would be two 3 bed 2 bath and one unit would be 2 bed 1 bath.

Would doing this qualify the property for FHA financing? Not sure if this has ever been done before or if it is even possible?

Are there any other low down payment financing options? I have about $50,000 liquid that I can put into the project.

[Paul Welden]

@Soniel Estime

Yes!

As long as the final product ends up being 1-4 units and you live in one of them as your primary residence for a min of 1 year.

You can even use 75% of the market rent for the other 3 units to help you income qualify for the FHA 203k Mortgage, if you need it.

Don't forget about the FHA Self Sufficiency (aka Stress Test) for 3-4 unit properties.