FHA 3.5% or Conventional 5%

[Austin Spitzenberger]

Good morning BP friends. I am currently looking to use an owner occupied loan to purchase a small multifamily (two-four plex). I have qualified for both 3.5% FHA and 5% conventional. I am aware of the benefits of each and understand how the loans differ. Here is my question.

When choosing between FHA and conventional lending, which one is easier to get lending on the second time around? I have read conflicting posts about which order you can do them in and if the order in which you do them is possible or not based on loan requirements. Which owner occupied loan should I use first and why?

Any help would be appreciated! Thanks

[Miller McSwain]

Another thing to keep in mind. Although you will have to pay PMI with both of those loans, with the FHA you will have to refinance once you reach 20% equity to get the PMI removed. With the conventional, it should go away without needing to refinance. That doesn't exactly answer your question, but it is information that I recently uncovered and found interesting. For that reason, I would choose the conventional.

I heard this on the podcast the other day, but I do not recall which episode. I am currently listening to the newest releases and catching up on all the old ones, so it is a bit jumbled.