Quote from @Bintou Diallo:
Quote from @Devin Peterson:
Quote from @Bintou Diallo:
HELP! it been 3years now I’m trying to buy a property but it seems impossible for me. I been under contract for with few properties but things always goes wrong.
I am under contract with a 3 family multi unit in New York with FHA loan 3.5down deposit property cost is 1mil. I got declined for not meeting the 75% rental income paying for the Whole mortgage. I really want this property.
my question is are there any banks that you might know who are willing to over look that requirement and help me close on the property??? I make over 200k a year. My income is not a problem. Please help me find a bank that have a chill under writer who can approve my loan because I don’t want to pay over 200k down deposit that’s literally all of my cash. Thank you.
Unfortunately these are the times we are dealing with when it comes to house hacking multis using FHA. 3 families are trickier especially. There really is no easy alternative solution for you here. If you can do either 15-20% down you will open up a few more doors / options. Other than that, your income is too high for any affordable programs. 3 families and FHA almost never work now a days.
Do you think certain banks will allow it or this is all the government banks have no say so on it. My agent told me to try two different banks and see if they can close on the property but I don’t want to waste my time with other banks if they have no power over the FHA requirements. And I do not want to pay more then 3.5% max Is 5%. I also don’t want to start with a whole new different bank and they run my credit score again just for them to say they can’t help me.
is there a way around the 75% rental income requirement by the FHA ?
No, every loan is under the scope of fannie/freddie no matter who originates your loan. It is the same scenario whatever bank your broker chooses. IF he or she can get creative here is what I would try to do:
1. Re-negotiate contract to ask for a seller concession to pay for your UPMIP. This will bring down your overall monthly payment and give you a chance. Idk the number just speaking from a strategic pov.
2. Sounds like it is a broker you are working with not a direct lender. I would consider going borrower paid on this deal. Which means, you will have to pay the broker fee maybe 1% of the loan amount for their service but this allows them to get a rate that covers the par cost of the wholesale lender. Also likely that the payment decreases a little in your favor.
3. You can try to find better comps in the area to challenge the rent schedule on the appraisal. (Highly unlikely but I've heard of it being done before)
No matter where you go. Here's the rule: 2 of the 3 units NET rental income must be 1:1 or greater to the PITI. (Net meaning you must use that vacancy factor of .25)
Good luck
