One loan to buy multiple properties?

Question

Hello all,

I saw on the marketplace a wholesaler (I'd imagine) who would bundle several properties together for 120k.

My question is, would an investor be able to use a single conventional mortgage to purchase that package/bundle, or would he need to take out several loans?
My route at the moment remains limited to either subject-to or FHA, as I don't have the assets to afford any more than 3-5% down. However, the owner-occupant requirement of FHA would, I assume, preclude this type of deal.

Jerry Padilla · Answer

@Chance Johnson

@Jaysen Medhurst

You can get a conventional mortgage for each individual property, not a blanket loan.

If FHA is your only option than you need to keep looking. FHA will allow you to go up to a 4 unit property (but only 1 property), but limits you to a maximum of 7 units with all properties you own. You are required to live in the FHA property for 1 year.

Chance Johnson · Answer

I thought that'd be the answer. I've been searching for a 3/4 unit multi for my first deal, and that is exactly my current path forward. Thanks for the answer!If I may ask, most people I've seen recommend living in the first FHA property for a year, then refinancing and using the one allowable FHA to purchase another property. Why do you suggest 2+ years?

Jaysen Medhurst · Answer

@Chance Johnson, I don't think you could do a conventional mortgage. Some banks (usually local/regional) do portfolio loans, where several properties are bundled together in one loan. That's relatively sophisticated and reserved for clients that have a track record/relationship with the bank. Not realistic for a 1st time deal.

I would look at owner-occupied 3-4 unit multiplexes for your 1st deal. Do FHA, live in one unit for 2+ years, then turn it into a pure investment property.