Low Down Payment Mortgage Options

[Blake Dowe]

Hi All,

My first property was a 3-unit house hack that I purchased through FHA with 3.5% down just under a year ago. I am now just about ready to purchase another multi and am having a hard time finding other low down-payment options to utilize.

Does anyone have experience with low down payment mortgage options for multi units for non first-time homebuyers? I am willing to move out of my current property to owner occupy the new one if necessary. One idea I've come across is to refinance out of my current FHA and try to get another one with 3.5% down, but I'm not sure how plausible it is to get another FHA Loan without an increase in family size or geographical job change.

Thanks!

[Blake Dowe]

@Leo Don That's a good point about the closing costs and PMI, I was hoping to have enough equity to cash out refi with the renovations that I completed. In theory that would give me closing costs back and enough left over to be very close to that 20-25% mark. But it would result in a higher interest rate that will cut into my current cash flow, so maybe it's not the best idea.

@Antonio Porta Definitely some good info! The Home Possible loan looks like a great option, especially if the PMI goes away once you have 20% equity. The only issue for me is with that loan you cannot have an ownership interest in another property. Good luck with your choice on FHA vs. Conventional!