Using a Gift to Pull Off Househack

[Austin Negron]

Learnt some interesting stuff today. For using an on 3&4 unit MF, you cannot use a gift as cash reserves. I believe you need at least 3 months of cash reserves (at least according to 1 lender). BUT! You can use the gift to make the downpayment - and use your capital saved as the reserved instead of using that as the downpayment. Just a fun little thing I thought was interesting and will definitely come in useful down the line. Do you guys know of some other funky maneuvers in regards to gift and pulling off househacks w/ FHAs?

[Bradley Padula]

Good info to share for those who don't know. That is correct, 3 months of reserves for 3 to 4 units with FHA loan. No reserves required for 1 or 2 units with FHA.

Be aware of the self sufficiency test for 3 to 4 units if using an FHA loan

Keep in mind, for retirement accounts (IRA, 401k), lenders will count a certain % of that towards reserves. So people sometimes have more 'reserves' than they think

To help boost income / qualify for a larger loan, you could plan to occupy the "smallest" unit that would bring in the least rent if rented out, and rent out the larger, more profitable units