What Financing Options do I have?

[Matthew John]

Hey guys, I'm in a kind of unique situation. 

I'm looking to house hack a multi family 2 unit that's currently going for around 110k. 

My issue is I don't qualify for a loan from the banks. I don't have a job, I've been self-employed for the last 6 months. 

My girlfriend is a full time student and only works part time, she made around 32k gross income last year as a Nurse. She has been employed in the same field for more than 2 years, but doesn't meet the income requirements to purchase the home. 

I have capital for a 20% down payment, but the lenders want to know where the money is coming from. My online business doesn't count because it hasn't been a full year and there's no taxable income until next year. 

I've talked with my parents about co-signing a loan, but they don't make enough money to qualify for a 2nd mortgage. 

Since I'm looking to live in the property while fixing it up, hard money lenders wouldn't qualify me. 

What other options are out there for financing? This seems to be the biggest struggle right now. 

Any help is appreciated! Thanks

[Michael Lee]

Hello Matthew!  Hopefully, you will get several good answers here.  I have thought about at least 3 ways you could go.  First of all, you might find a place where the Owner will finance you.  You could show him on paper the possibility of making more money that way and spreading out his tax liability instead of having to report all at one time the next year to the IRS on their tax return.  Hopefully, you can build a good relationship that might make him feel more comfortable to your question of their interest.  You could get a Private Lender to possibly put up their money which is more based on the property value or promise.  It like Owner Financing is that it is more negotiable.  You may have to pay a little more for their loan but I hope your deal is good enough to want to go with you.  Their loan is usually short term and you will be forced to refinance after about 12 months.  Another way to get qualified by getting a "cash rich" Partner but you might have to give them a portion of your profit and that depends on how much they are involved in the deal.  The profit split will be between 35 and 50% but its usually better to get part of something is usually better than nothing.  The first two options would be harder to get a house hacking loan.  Those two are pretty flexible on the deposit made.  How good the deal is will probably make your deal easier or harder to get their involvement.  The better the deal is may effect the down payment amount required.  A tri-plex or quadraplex might make the alternates easier and possibly eliminate your rent on a house hacking deal.  Good luck to you!