All Forum Posts by: Kelly M.

@Charles E. Perdreauville

Thank you for your reply. So FHA would defer to my county to determine if I had one or two live-able units?

So I should check with my county to see about getting a permitted apartment on the property, abide by those regulations, then FHA would recognize the property as a duplex/multiple family or whatever was approved by the county?

Kelly

Hi,

I'm interested in purchasing a single family property that has the potential to be a duplex or triplex (very large house). I want to live in one unit and rent the others. I would like to use the other units potential rental income to qualify for the FHA loan.

Sounds easy....But, right now the house is just a large single family property with a bunch of rooms, bathrooms and an extra kitchen. The zoning allows for apartments and many of the large houses on the street have apartment units.

But, what is the specific criteria for FHA to consider a home a "duplex" or "multi family"? Separate electric? Fire barriers? Separate entrances? Etc?

I own two other rentals, and likely would need the potential income from the other units to qualify for the loan. My idea might be to get a bridge loan until I can separate the property into qualifying units?

Any feedback is appreciated

Thanks!

@Shaun Weekes thanks Shaun! One of the units is commercial, and not owner occupied. I don’t believe I’m eligible for a Fannie.

@Jared Rine Lendbase

@Matty Foley Thank you so much for your thorough feedback. I really appreciate everyone’s perspective on this. I was really nervous to commit. but was trying to convince myself it would be okay. After receiving all the feedback (including yours), I have decided to go a different route. Thanks again

@Ronald Rohde Thanks Ronald. I sadly agree :(

@Jared Rine Thanks Jared. That all makes sense to me. I thought the terms were a little "too good to be true" as well, although I was optimistic! I definitely see what you are saying, if they are paid up front what incentive do they really have to get the job done? He tried to talk through it ($5000k "deposit") so well but, I just wasn't convinced, something seemed off. Maybe the deposit after the LOI? But I even called my current bank after reading all the posts on here and they said their fee would only be $600 (minus third party fees of course). That's $600 fee versus a $5000 non guaranteed fee! I'm so glad I posted on here to get this feedback. Thanks again

@Greg Dickerson Thanks Greg. That’s what I was thinking too. I just couldn’t believe I would be getting scammed! But it still didn’t sound right, and I just don’t have enough experience yet to know for sure. Thank you for your input. Maybe it saved me $5000k!

@Bill Snyder Thank you. That makes way more sense to pay the fee AFTER commitment to lend. I’m glad I posted and got this feedback. It’s appreciated!

@Andrew Beauchemin Wow! Unheard of! Thank you for the context. That’s what I was looking for. It seemed at minimum “unfair”. I’m glad to know I’m not crazy.