Fannie Mae Owner Occupied 5%

[Christopher Morris]

Happy Friday BP! 

As we all know, Fannie Mae has come out with their 5% down, owner occupied loan for multifamily (2-4) properties. I understand this eliminates the "self sufficiency" test that the FHA requires for 3-4 units - which is great news.

I already own an FHA house-hack in Northern NJ and I'd like to land another one in Q4 2024 which would roughly be a year since closing on my first. Ideally, I'd like to purchase another house-hack in the same town I currently am at, but... I hear that can be difficult securing lending on two owner occupied properties in the same town / area. From what I've heard, you'd basically need a good "excuse" to not live in the first one any longer. Those excuses could be - difficult neighbors, bad neighborhood, too far from job, and others. How true is this? 

What would be the best advice here? I do have other towns in mind as a backup, but my first choice would be to continue investing in the town I already live in. 

Also, does this Fannie Mae 5% down require the owner to live in the house for a certain period of time like the FHA? Any and all information would be greatly appreciated!

[Matt Devincenzo]

Just a quick clarification FHA and Fannie are two separate entities, which your post seems to recognize. The Fannie guideline change doesn't eliminate the self sufficiency test as FHA still requires that, it just lowers the Fannie down payment for 3-4 units from 25% to 5% and since Fannie has never had a self sufficiency test you avoid that issue.