Looking to move out of my first house hack and into my second...

[Dillon Heinaman]

I am currently in a duplex that I purchased in August of 22'. I ended up having to put down 15% on the place when I found out that it is standard you can't put down any less on multi-family anymore. I currently don't have any FHA loans going, here is kind of what I think I want.

4+ Bedroom 2+ Bathroom house near a University with an FHA loan (Hopefully with an ADU).

This seems to be my best house-hacking option at this point. Any advice? Would y'all go a different route? Are there lenders out there that will FHA multi-family still?

[Lawrence Potts]

Quote from @Dillon Heinaman:

I am currently in a duplex that I purchased in August of 22'. I ended up having to put down 15% on the place when I found out that it is standard you can't put down any less on multi-family anymore. I currently don't have any FHA loans going, here is kind of what I think I want.

4+ Bedroom 2+ Bathroom house near a University with an FHA loan (Hopefully with an ADU).

This seems to be my best house-hacking option at this point. Any advice? Would y'all go a different route? Are there lenders out there that will FHA multi-family still?

That's interesting that you couldn't use an FHA loan on the duplex. Typically that is the only loan product you can use if you're a first time home buyer looking to buy a multifamily property. 3.5% down. The self sufficiency test usually only needed on triplexes and 4plexes but it could differ depending on the location. But I do find it odd that you couldn't use FHA (unless you already bought a home). Only changes FHA has made is that your seasoning period changed to 12 months, as far as I know.

You can still FHA, however, FHA a multifamily right now for your situation may be difficult. FHA was designed for first time home buyers with lower incomes. They do not want their product to become an investment product. If they see you are currently living in and own a duplex, they may not lend to you if you are trying to buy your second home as a triplex. Talking to a lender about this is very important in order to identify your next step. It highly depends on your situation and how underwriters will view it, not so much lending as a whole.

I think looking for a property with an ADU is a great route to go. There are lenders that are coming up with products specifically with ADU's . I'd connect with @Grant Schroeder, his company can get you connected to a local lender and agent. I recommend looking at your local municipality's rules for ADU's. Some cities/counties are allowing for conversions to meet low housing inventory needs, but they'll have requirements for size, location, etc. Something to consider. Make sure that if you're looking at a property with an existing ADU that it is properly permitted!

Hope that helps!