Part rehab, part occupied... Will it qualify for a mortgage?

[Aaron Hale]

Hey BP,

I’ve located a triplex that has some potential but am wondering about financing. It is 33% occupied and the one unit puts it over the 1% rent to price ratio. However, the other two units and the exterior need swork to make rent ready .

In general terms, would this property still qualify for an agency loan because it is occupied?

Thanks for the input! 

[Chris Mason]

Originally posted by @Aaron Hale:

Hey BP,

I’ve located a triplex that has some potential but am wondering about financing. It is 33% occupied and the one unit puts it over the 1% rent to price ratio. However, the other two units and the exterior need swork to make rent ready .

In general terms, would this property still qualify for an agency loan because it is occupied?

Thanks for the input! 

 In general for a traditional loan, it needs to be a complete and functional home absent safety hazards. 

Example of a no-go: Missing an oven. Can't cook food = not a kitchen = not a house, in Fannie Mae's eyes.

Example of a go: 1970s gross yellow wallpaper stained with cigarette smoke, fridge from the 1980s in that yellow color. But everything in that kitchen functions.