All Forum Posts by: Michael Facchini

Lots to read and discuss here, but in short the best bang for your buck at this stage in your life is likely to purchase another primary residence multi-unit with as little down as possible, either as a rehab loan or standard purchase and then do improvements over time, increase rents, etc. The only concern is, if your property now was financed via FHA you will have a hard time buying in Chicagoland again unless your family (IE kids) have increased significantly in size. Conventional channels allow as little as 5% down (depending on the area), but you're not eligible if you own another property at the time. If you bought conventional on the 1st one though, you can look at FHA for this 2nd one. Otherwise, you might look at a conventional rehab where you put 5% to 10% down, but then through the rehab you pickup another 10% to 15% equity and hit the 80LTV upon completion. These are your low down payment, multi-unit financing options.

Kevin, that rate might be a little high but not a whole bunch higher than the more competitive rates out there.  Really depends on property type, loan amount, and other details to see how much room there might be.  But as others have said, you'll see the best rates at 25% down.

How many units is the property, what is the residential/commercial breakdown, and where is it located (suburb or neighborhood)? 

A few questions:

1) What is the expect property purchase price and then the amount of the rehab budget on top?

2) What type of property and where about?

3) How long do you expect the project to take?  And then once complete, you're looking to sell it?

4) Do you own other financed homes/property currently?

I work primarily in/around Chicago and focus on 2-4 units.  I can't speak for the Quad Cities, Rockford, etc., but I'd think it would be difficult to find a $50k multi-unit that is worth writing home about.....I'd assume it would need some capital improvement/stabilization.  But again, I can't say.  I will say that financing it will prove to be difficult.  Many lenders have loan amount minimums...simply due to the amount of work that goes into a loan.  Same amount goes into a $500k loan as a $50k loan, and can be a losing proposition for lenders due to regulatory pressure alone.  Many lenders have minimums of $60k or $75k.  You might find a local bank that goes lower, but they might also have higher rates and stricter guidelines.  Hope that helps!

Isaac, I do a ton of multi units, so I can say with experience that if you're buying your 1st place, occupying, and it's in the city, 5% is almost definitely what you can do unless there's something we're missing here. 25% is the minimum for an investment/non-owner occupied property. 20% is the normal down payment for owner occupied...but in your case, based on above details, you should be able to do 5% down. I do this ALL the time for my clients.

Where in Illinois are you from originally?

Without seeing it and spending some real time evaluating, that price seems fair....not a steal by any means....but they will likely get close to their list.  Multi-units appear to be in demand more than I've ever seen in my 16 years.  First-time buyers, seasoned investors, international money - lots of demand from all angles.  So, while months ago that price would be a stretch, nowadays the seller will likely get it.

You will be looking at 25% down conventional, unless you live there. We have 20% down investor options, but at higher rates. Normally though lenders require 25% down.

Do you mind sharing some basics of your scenario?  Property type you're trying to buy (single family, condo, 2-4unit residential, townhome, etc.), general purchase price range, location/town/neighborhood, amount you'd like to put down, primary or investment property (occupancy), and any background on your job/income and credit/scores....just the basics.  Feel free to PM me if you want to keep it more private.  From there I'll get an idea of why he's being shy with info or what might be going on.