Suggested Questions for Lenders

[Kristopher Werner]

Hi BP!

This is my first post, hoping for some help from the community! I'm making the leap into Real Estate investment and have started talking to lenders to find the best fit for my first investment, a multi-family that I can house hack. After talking to two lenders I've realized, I don't really know what questions I should be asking. I'm leaning towards FHA for the low down payment but other than "how much?" and "am I approved?" I'm not really sure what to ask. Hoping for some suggestions from some investors that have been through it. I just want to make sure I'm not missing anything obvious or if there are any not so obvious things I should be aware of. Thanks for you help! Kris

[Matthew Porcaro]

Hi Kristopher - there's a lot to consider when going after an FHA loan. Typically, the requirements are:

• 3% down payment + 1.5% premium for mortgage insurance (this can be rolled into the mortgage)
• owner occupied - which would be fine if you're house hacking
• 580 min credit score
• Steady income for the last 2 years

I used this exact strategy with an FHA 203k loan (rehab loan). I put 3.5% down, then rehabbed a duplex property I bought which was a foreclosure. I lived in it until I was able to refinance out of the FHA loan, and now have a conventional loan on the property, and no longer need to pay a MIP every month.

If you have any specific questions on it on what's holding you back, please let me know. I did this as my first deal and suggest everyone do the same!