All Forum Posts by: Brian Scott

Hey everyone,

My wife and I purchased our first multi family home in Feb 2022 for 495,000. We currently own 450,000. We purchased the home with FHA loan at 2.75 %

Our rate is excellent but we are looking to purchase our next MF and need some advice on how to get into it.

I know Fannie Mae has a 5% down MF loan program as long as we move into it. I am not really a fan of the program because we have a very nice situation in our current home.

Putting 20% down for a conventional loan is a steep task financially so I do not think that is an option plus I have been told by many of my friends with multiple MF homes to never use your own money to get into one.

Then there is always using the equity we have built up in this current MF home we live in to purchase the next - I am not sure how that works but have done some research on home equity loans and believe that would be another option.

Any advice would be greatly appreciated! Thank you!

Hello everyone,

My wife and I own a mutli-family home and purchased it in February 2022 for 495,000. We put 5% down using an FHA loan and currently have an outstanding balance of 450,063.

We have a PMI payment of about 300.00 per month.

We have put a considerable amount of money into the home to include a completely renovated 2nd floor 2 bedroom unit. Updated bathrooms on the first and second floor. A new kitchen on the first floor. New roof. New paver patio. New Driveway. New Garage door on detached 2 car garage.

My mortgage company is Citizens Bank and from looking at their rules for PMI cancelation(per google AI) they are:

"Citizens Bank will automatically cancel private mortgage insurance (PMI) when your loan-to-value (LTV) ratio reaches 78%. This means that the principal balance of your loan is 78% of the original value of your home. You must be current on your mortgage payments to receive this automatic cancellation. You can also request to have PMI canceled earlier if you meet certain requirements:

• You reach 80% LTV in your home
• You have 20% equity in your home
• You have a good payment history
• You have no other liens on the home

You can request a PMI cancellation in writing to your lender or servicer. You may need to get a home appraisal, and you'll be responsible for the cost"

My question is : Should I have my own appraisal done by a reputable company that would be accepted by banks for appraisal estimates and then request Citizens to do their own appraisal for a request of PMI cancelation. This way when they try to low ball me I have my own appraisal ready to go.

Or - should I just request a PMI cancelation from Citizens bank and wait to see what their appraisal comes back at.

Or - am I going about this all completely wrong?

Please advise - thank you!

 The second floor is rented out at 2100. It is completely updated 2 bedroom with all new appliances to include washer and dryer. I had them installed during the remodel up there.

The first floor where my wife and I currently occupy is also recently updated with a new kitchen, all new appliances and is also a 2 bedroom with a fully finished basement. I plan to to rent it for 3500 when the time comes (first floor with basement)

We are currently looking for our next multi family but just need to figure out the best route forward for financing the purchase.

Use our own money, tap into the equity here, refinance here out of our FHA to roll into another one at our new property, go the Fanny Mae route with the 5% down Multi Family home loan program.

We need to find the right fit.

Fanny Mae does have a 5% down owner occupied loan program for MF purchases.

Any thoughts? 

Hey everyone. I am the owner of a 2 family MF in NJ. My mortgage is 3232.00. I rent the second floor for 2100 which leaves me with the remainder payment of 1132.

Am I generating cash flow since I have approximately 65% of my mortgage covered by the tenants?