Question about mortgage

[Chancellor Swan]

Hello, I have a question about a scenario I'm working out in my head. Utah has a program where they will allow zero down for first time home buyers. I was thinking of taking advantage of this program and then after a year refinance to a conventional loan and then buy another home and move into it with a FHA loan so we can get in with only a 3.5% down. We would then rent out the first property. Does anyone have any experience with this or any tips or things to be careful of?

[Eric Johnson]

@Chancellor Swan

What are the details of the first time home buyer program? Many of them have stipulations and overlays that prevent people from taking advantage of them (because they want legit families not people gaming systems). Although, they may have only a few.. 

The biggest concern is even if you got in with 0% how will you refi into conventional after only 1 year? You need at least 5% equity to go conventional (max ltv for conv is 95%). 5% equity won't happen in one year. You can expect 2% equity per year, should markets be balanced.