Building a Multifamily portfolio via house hacking

[Justin Crookston]

Hey everyone I have a couple questions regarding my situation. I’m trying to build a Multifamily portfolio by househacking every year. Here’s what I’ve done so far:

Feb 2020- bought a single family home with a FHA 3.5% down payment. Lived in one room and rented out the others.

March 2021- got married and bought another owner occupied single family home. This time with a 5% down conventional loan. It’s got a basement apartment. So we live in the basement and rent out the top. I then refinanced my Feb 2020 property in to a 25% conventional (investment) loan.

I now want to househack a fourplex by living in one unit and renting out the other three. I want to put 3.5% FHA on the fourplex.

Here is what my lender has told me:

1. The only way I can put 3.5% on a fourplex is if I owner occupy with an FHA loan. I can't do this with a low down payment owner occupied conventional loan. Only an FHA. Otherwise I would have to put like 25% down. Which I am ok with this answer unless anyone knows of another way to get 3.5% down on a fourplex other than using an FHA.

2. Moving from a single family home to a fourplex is downgrading and the underwriter will say the story doesn’t make sense. So I am wondering if I then refinance this March 2021 home in to a 25% conventional (investment) if that will then free me up to where the story no longer matters because I have two investment properties? My lender told me that even if I did that it would be hard because it’s going from a single family to a fourplex. Which doesn’t make any sense to me because they would both be investmets. Any help??

3. He also said 3 of the 4 units have to cover the whole payment (PITI) in order for them to even lend on fha 3.5% on a fourplex. This is almost impossible to do in my area right now haha. So I'm wondering if I can use my personal income to qualify for the difference on that if not all 3 units can cover the payment. My lender told me that he thinks that even though I can qualify that they probably still wouldn't lend on it because 3 of the 4 units have to cover the whole payment. This doesn't make any sense to me either if I can qualify for the difference. Any help?