FHA loan (3.5% DP) vs Conventional loan (5% DP)

[Sarann K.]

Hi everyone,

I'm looking to buy a duplex as my first rental propertyand really want to rent both unit out while still living at my current apartment, but I just realized that I am going to hit a road bump. So if I use FHA loan, I will be required to stay in the house for at least 1 year before I can rent both out. On the other hand of the conventional loan, I will need to make 5% DP.

Here are my questions:

1.If I use the conventional loan, how easy would I be qualified for the 5% DP and would I be able to qualify for rehab loan as well? Are there any hidden requirements if I decide to use conventional loan?

2.Should I use FHA loan and live in one unit and rent the other out? However, I don't want to live in the property because the place is too big and it's not financial efficient for me to stay there.

Any comments would be really appreciated, thank you very much!