USING FHA AGAIN? HAVING 2 FHA LOANS?

Question

Hi I purchased my first 3 family 3 years ago with a FHA 10 percent down owner occupied. Has anyone attempted to try and buy a 2nd owner occupied 3 family moving from your 1st to your second with a FHA Financing for your second 3 family or investment property?? and used a FHA loan again with a small down payment since you were moving to a new owner occupied. Or did you have to do a conventional 20 percent down and be owner occupied for the 2nd owner occupied? Or did you just have to do a 25 percent down Investment loan conventional?? I’m wondering if anyone has used a FHA loan twice for multi family’s only.

Michael Wegner · Answer

@Shaun Weekes

Great advice throughout entire thread! - I will also (hopefully) be going through this exact same process in about 18/24 months. Good luck with everything @Edward Eloma . Keep us posted / update us when you go and make it happen!

Shaun Weekes · Answer

If your loan amount was 208.5k at 3.99% you're looking at a payment of $1,525.21 including your taxes and insurance.  This is saving you about $225.79 a month.  If you multiply that by 24 months or 2 years, you're saving $5,418.96 so you'll recoup your money in about 20 months which is good.  On top of that your rents are going up and you're using a 3.5% down payment to acquire another 3 units.

You have 3 years of experience so you can use new rents towards your income and as long as your C.I.A. (Credit, Income and Assets) is solid I would move forward with getting the deals done.

Just my 2 cents and I hope this helps.

Edward Eloma · Answer

@Michael Wegner and @Shaun Weekes one question you always ask yourself is for the second property you buy..since we’ll both be doing a FHA, would it be smart to put the lowest amount down “3.5%” or should you put maybe 10% down to lower the PMI amount a little. If you put the 3.5% down you’ll have more money in pocket. But if you put 10% you’ll make a little more money in your pocket. But I think it’s smart to put the minimum down because then you’ll have more money in savings to be able to fund another deal. Opposed to dropping all of your money into the house and not being able to use that money because it would be In the equity and not your bank account. Just a thought!

Shaun Weekes · Answer

@Edward Eloma

If you have enough equity in your current triplex refinance it as an investment property.  Then you can buy another triplex with as little as 3.5% down FHA.

Edward Eloma · Answer

@Shaun Weekes yes thank you so much! I appreciate your help. I will do that

Edward Eloma · Answer

Okay yes that makes sense, I have the 20 percent so mine as well to with that conventional financing and avoiding MI. And having a Lower loan

Shaun Weekes · Answer

@Edward Eloma

I think it depends on how much money you have and what vehicle you're keeping your money in until it's time to buy again. Once you figure this out you can then say to yourself I'm going to put down x amount.  Work backwards to figure out how much you're going to put down.

Edward Eloma · Answer

@Shaun Weekes okay so I currently owe $204,000

The appraisal will come In at $290,000-300,000. I do not want to pull out any money. I saw rates for refinance at 3.25% but I am currently at 3.875%. I pay on a 30 year currently with 3 years in about for $1,751. Property taxes is $323 a month, and insurance is $208. And PMI of $134 for 11 more years since I put down 10% when I first bought the house...My rents would total $2,625.

Shaun Weekes · Answer

Since you're unemployed I would wait until you go back to work before you move forward.  Let's say you do a lock for 60 days and you're still not back to work. You would then need to re lock or extend the lock and that costs money.Also, if you're unemployed that would need to be stating on the mortgage application and will most likely disqualify you unless there's other income besides rents.  If you qualify with just rents that's an option as well so have your LO look over that possibility.  Have him/her monitor rates to make sure there's not any large jumps and just go from there.

Edward Eloma · Answer

@Shaun Weekes yes I’m definitely going to go through with it, is there a grace period of when I can purchase my next 3 family after I refinance it and use a new FHA? And also I’m unemployed I’m going to try and talk to a loan officer and see if I can lock a rate now and refinance once I’m back to work. Thank you for advice Shaun!

USING FHA AGAIN? HAVING 2 FHA LOANS?

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