All Forum Posts by: Pamela M.

Yes I am talking to other lenders and they said the same thing. The worst part is we had 2 months hiatus to solve these issues which are brought up last minute!

Hi all,

I am in the process of buying an owner occupied multifamily (3 unit to be precise in Newark). This has been an ongoing saga. I was aiming for 5% FHA which I was approved for. But there were so many silly issues and I think the lender just had no clue of the lending rules. We were/are supposed to close on September 1st. I would like some advice. These are the things that happened (listed below).

1. The FHA appraiser had a typo in his report: Instead of typing in 55 for the longetivity of the property he typed in 15. My lender said he cannot give me a 30 year loan based on that although the property was in great condition. We went back and forth. That took a week to resolve with the appraiser finally fessing up to the mistake.

2. I had joined a new job and because of other personal issues they wanted me to show 1 year of employment. So the closing was delayed for 2 months (This was June end). The seller agreed  (which is rare in this market) and we decided Sept 1st would be the day. The lender assured me there was no other issue. I waited thinking that everything is ready. 

3. 2 weeks back  (mid august) the lender  informs me that the underwriter wants to see 75% of the rents to cover my mortgage. Its the standalone test. The seller had not raised rents according to the market. The seller had it as an investment property and I would have it as an owner occupied. This was not pointed out to me during or before we went into hiatus for 2 months. The seller and I would have moved on. But now I am definitely stuck.

Now the issue is the seller wants to put the property back on market and I think I will lose my downpayment. I have pointed out all these things to the lender and they are going back and forth with the appraiser with comparables but I have no hope at this point. It's still not Sept 1st but what are my lending options with 5% downpayment for a multifamily? 

Can someone advice me?

Thanks,

P

Hi all,

I am trying to close on a multifamily property and to begin with it's been a journey. This is a FHA loan so I understand it is strict. The appraisal came out to be lower than the list price which the seller agreed to. The house in a decent condition (no repairs needed) and in a decent location and is selling for the average price of that location. Recently my lender informed that the appraiser had noted this:

The appraisal/property was not able to be approved as it did not meet FHA requirements. The remaining economic life for the home is only 15 years and the term requested was 30.

So my lender has offered me 15 years which I do not want. Is there any workaround for this? Any suggestions are appreciated. Thanks! 

Hi joseph,

I recently met my future tenant and I think I would like to keep the Section 8 tenant but do you have any idea of the rules in Newark for a multifamily to be converted to condos? Thanks!

Hi Benjamin,

I understand your point and that's why I am here to get pointers. Thanks all!

Thank you so much Ray. This was great help. I was kind of drowning in the information and the Section 8 housing department was not so co-operative! 

Hi Jennifer,

Thank you so much for the prompt reply. Yes absolutely. I believe in being a good landlord. And I don't want to add anything more disastrous to the ongoing situation in the world. My plan is to give them more than 60 days if needed. But I  have never dealt with Section 8 and I am a little tensed/worried about buying this property. Also this tenant does not have any deposit with the landlord. I guess it is not so uncommon. The only reason why I am interested in this property is because of it's location and the complete 3 units it comes with. But ideally in the long run I would like to end Section 8 completely. 

Thanks Craig for the prompt reply. But what if I don't want to have a Section 8 anymore. This will be owner occupied. Can I ask the tenant to evacuate? She is currently on month to month without any deposit. This arrangement really baffles me but I am new to all this too. 

Hi all,

I am in the middle of buying this multi family in Newark NJ and its a good deal but the second floor tenant is an elderly Section 8 tenant.  I don't want to continue with any Section 8 (after I buy this property) but would like to give the tenant sufficient time to find something once the moratorium ends. I understand there are a lot of opinions of what to do and what not to do but what I am looking for is advice on how to end Section 8. Has some one done it? How much time does it take? Also is there any clause for the elderly. I called up the Section 8 office here at Newark and they were not friendly.  Any suggestion/help is appreciated. Thanks!