Investment property 20% down payment minimum?

[Phillip Repalone]

Im looking to purchase my first rental property this year and I need advice as to which route I should take. I’m only interested in multi families in the Philly area but I don’t know if I should say I’m purchasing as an investment or go with an fha. From what I’m hearing, as an investment property they’ll ask for a 20% downpayment which I don’t believe tying up that much cash would be smart. But if I purchase with an fha loan, I’ll only be able to rent out one side for the year due to the owner occupied requirement of 1 year. Is there a smarter option that someone can suggest? Thank you.

[Jared Hottle]

Call a bunch of small local banks in the area and see what they can do for percent down. I heard of a bank that said if you have a personal checking account and move a certain amount to that personal checking they would do 15% down. They can be pretty flexible since their loans are in house especially if  you let them know that is your biggest thing you are looking for in a loan. 

Another option is ask for seller financing. It never hurts to ask. I have been asking for 10% down, 5 year ballon. Owners may like it because it defers taxes and right now there may be no better return for their money. Then in the next couple years refinance your property to get the ballon paid off.