All Forum Posts by: Diego A.

Hi @Antonio Adams, sorry for the late response but work has been crazy! Anyway, because we bought our 4-plex owner occupied. We shopped around and the best provider at the time was Farmers. If you want the contact info of the insurance agent let me know (she is in College Station). I hope that helps.

Hi @Courtney Wozcoz was hat question for me? well if it was.... I did a FHA loan and I did not created an LLC at the time because of the FHA loan (It has to be on your name)

Hope that helps, have a successful day! 

Like @Wayne Brooks said FHA is only for owner occupied homes. However just to elaborate a little bit more from what @David Krulac said. There are two main ways you can repeat the process and one a little harder to prove:

1. You have to occupy the property 3 years OR

2. You have to move 90 miles away from the current property OR

3. If you can prove that you need more room or a bigger space to accomadate the need of a growing family (this one is hard to prove and it will be basically the underwriter deciding if it is true or not)

I have two properties with FHA because I met one of this criteria. This was true when I bought my properties so you should ask your loan officer to confirm this. When I was buying my properties these were the rules so make sure they have not change.

So, the short answer is: "No, you won't be able to finance the 4th property with FHA, unless you live in the property (basically the property needs to be your homestead)."

I hope that helps

@Melissa Lenhardt I think it will be grounds for eviction if your contract mentions it.

I used a Texas standard contract and in the contract it does mentioned that "if you turn utilities off of if you do not connect them; then there is a violation of the contract" which a violation gives the landlord grounds for eviction.

Why didn't you turn the utilities off? I turn my off before every tenant comes in to give them time to turn them on in their names. The utility company here does not allow two different names on the accounts so I make sure my tenants do not have any trouble to turn utilities on.

All the best,

@Yesenia C.

An FHA loan is for owner occupied properties. So you will not be able to use an FHA loan for the property in Colorado unless you move and live in it. In this case you can have two FHA loans.

In fact you can have more than one FHA loan if you meet some criteria:

1. You have a family size increase: In this case you have to show the lender that you need to upgrade your space due to increasing the number of dependents in your house. (This one is hard to prove for the underwriter)
2. Relocation: if you move over 90 miles from the location (usually for new employment) of the current property that has the FHA loan.
3. 3 years after the last FHA loan purchased: This one holds but the assumptions is that in 3 years you do need more space.

So if you meet any of this criteria then you can buy a new property with a new FHA loan and keep the house you recently bought with the original FHA without refinancing. You can do whatever you want with it (aka renting it)

You cannot split approved % (like 1/3 of the amount) because that would give you more than one FHA loan without you meeting any of the criteria (especially because you would not move there).

To me the best way to find a lender is to go local. Interview as many lenders as you can an work with the lender you feel more comfortable and that is knowledgeable about the rules.

Most likely you will have to get a conventional loan and put 20%- 25% down because the property will be consider an "investment" property. Therefore, I don't think you can get a low down payment because you wont be living in the property. (I asked this to me lender)

Yet, it is possible for you to get a conventional loan for 5% down payment if the underwriter thinks or assumes the house in Colorado would be a "retreat" (or second home) for you; but this is hard to pull because you will be getting it with the intention to rent. (If someone else could confirm this I would appreciate it)

Warning: I am not a lender. I did all this research when I was trying to finance my properties. This is the information that the lenders gave me and BP

Have a good one!

@Adam Johnson

Thanks for the clarification.

Have a good one!

I am sorry if this is out topic but I have one questions. @Adam Johnson

with respect to adding the water to one of the apartment, do you charge the tenant the water use for all the units (meaning the water use for the washer?) If yes, don't you think that could bring you problems with the tenant that you are charging the entire water bill?

I am sorry if I misunderstood but I was just curios.

Back to topic, great idea on the storage units! here in my market tenants pay a premium for extra storage.

Have a good day!

Hi Brian Porter, we did something similar to buy our properties but according to our loan officer (two months ago) the restrictions are as follow:
You can get another FHA loan 3 years after the first one OR
If you move over 90 miles from the current resident with the FHA loan OR
you have a legitimate (this is one is very difficult to use) reason to upgrade your residence (like you are having a baby and need an extra room or something like that.

For moving the property as far as I know when you refinance you will need at least 20%. This is what my loan officer said and the local bank said also when I was trying to figure out if I could refinance because I knew the property had gone up in price.

I hope this help, and keep us inform if you figure another way around it.

Good luck

Hi John P. welcome to BP!

Great!!! I will do my best to answer them!... and if I don't know the answer we can ask the BP-nation!

Have a good one!

Hi Charles Rixey, welcome to BP.