Cant find a loan that works

[Meg K.]

This is an answer i received from the loan officer. I am frustrated because a deal i wanted fell through when the Bank that was selling the property refused my FHA 203k loan...then i tried a conventional loan. The bank wants 25% down and i have to pay points ince I wanted to borrow under $40,000...that's $13k down on a $28800 property...this is my first investment...i do not have 13k for a down payment...below is a reply from the loan officer about FHA loans...i am feeling discouraged!

In most cases the min required is 3.5% down, however since FHA has recently changed their mortgage insurance requirements and increased the premium on their mortgage insurance, we aren't seeing many loans with under 5% down and a 30yr term getting past the application process.

Is there a specific reason you would like to go FHA? I don't normally recommend the program to folks unless they cannot qualify for any other program or do not have the 5% required for a conventional mortgage... the PMI rates on FHA are extremely high now due the changes implemented on 6/1.

Any feedback? THanks, Meg