Financing my first 4-plex.

[Dawn McGill]

Would appreciate advice on reserving capitol to buy additional investments. I am under contract for a 4 plex, no rehab needed and it's rented. Typically it's 25% down conventional with about $11k in cloisng costs/pre-paids plus the $70k down and this eats into a lot of my capitol.  I want to be able to acquire several more of these especially as my market goes into the winter and prices tend to drop.  Any advise or loan products I should be aware to lower my costs and preserve capitol?

Thank you in advance for taking the time to share with me your experience in lending.

[Ryan Moore]

Originally posted by @John Boychuk:

Is doing an owner occupy loan like FHA off the table for you? I know that's what everyone recommends, but it is a great tool to get into the game. Otherwise, you can get a conventional loan as low as 3% down, but 5% is easy to get with decent credit.

If you are in a position where you won't qualify for FHA or owner occupy, I would recommend looking into private money loans.

Someone please correct me if I'm wrong, but you cannot get a conventional loan on a 4-plex rental below 25% unless you are owner occupying.   I've been speaking to several lenders for a few years on residential multifamily and 25% down is the minimum I've ever been told for non-owner occupying.  I have had agents and other investors shoot me figures that included 20% or lower, but then they are alway correcting themselves when I bring up the 25% rule.