FHA loan after FHA loan

[Megan S.]

Newbie question!

If I buy a MF home as an owner occupant with an FHA loan, then plan to turn around and rent all units out (after a given period of time), will I be unable to secure an FHA loan for my next property? Is this why people refinance in the BRRR strategy? Thanks!

[Andrew Postell]

@Megan S. all good items so far on this post. This is a very common topic. One thing that is a common sticking point is that when you buy with an FHA loan you only need a minimum of 3.5% down when buying a multi-family property - that's a HUGE advantage. BUT when you refinance from an FHA loan to a conventional loan, the conventional loan will require you to have 20% equity. So if you put down 3.5% and then need 20% to refinance...it might be a big sticking point. Make sure and plan accordingly. I'm not saying don't buy a multi with FHA money...just saying to know all the information so you know how to plan. Thanks!