Seeking more extensive advice on securing my first investment property

[Richard Pennington]

My name is Richard Pennington I am in the Raleigh North Carolina area seeking any advice on using an FHA loan or conventional loan for my first investment property. My best rule of thumb is to have 20k for every 100,000 on the property I am soon to acquire. I would want to keep extra for reserves along with contingencies, plus if anyone in the area has stored away the 10,000 for a cost segregation details on that would be helpful too.

[Chris Martin]

As you are probably aware FHA rules state "FHA’s single family programs are limited to owner-occupied principal residences only." Further,

"At least one borrower must occupy the property and sign the security instrument and the mortgage note in order for the property to be considered owner-occupied.

"FHA security instruments require a borrower to establish bona fide occupancy in a home as the borrower’s principal residence within 60 days of signing the security instrument, with continued occupancy for at least one year."

But 15% down, plus reserves, I think, is in the current Eligibility Matrix. I haven't done a conventional loan for decades, so someone else can chime in. The FNMA Selling Guide has other underwriting details.