All Forum Posts by: Patrick McCann

Quote from @Richard Qiao:

So I'm currently living in Massachusetts, considering a multi-unit house hacking opportunity in New Hampshire. The lender agent denied the FHA loan application, because my current residence is much more expensive than the house I'm going to buy. Is this reasonable? How should I proceed with house hacking opportunities?

I do not know if that’s actually a technical reason for the lender to disqualify you from using an FHA, maybe someone else will know. Good news is though, you don’t have to use an FHA. Very soon there is a new Fannie Mae/Freddie Mac loan product coming out for 5% down conventional loans on 2-4 unit properties and rental income can be included towards your income. I believe it launches next Monday 11/6. Maybe some lenders will chime in that know more than I do or a google search could give more info. You would think a good lender would mention other loan products to you that could work especially considering the number of mortgage applications are down and lenders don’t get paid by not closing loans. 

I've always heard it's good to talk multiple lender. I've also heard that different lenders can have different interpretations on the FHA guidelines or have their own guidelines beyond the FHA ones.

Quote from @Aaron Bard:

@Alecia Loveless

Haha believe me, I'm on Zillow CONSTANTLY it's probably unhealthy.

My biggest issue with finding off market deals...is that I don't know where to go to find them.

Any suggestions?

Thanks for the reply!

 A simple way you could find off market properties is you could go and drive through those towns or look on google maps for the properties that look like multifamilies. Then you could look at the property record cards on the town/county website for more info on the properties and the owners information. Then find the owners mailing address/phone number and call them or send them a letter to see if they’d be interested in selling. Tell them you’re a young local guy looking for a multifamily property in that area. 

was this an inherited tenant?

Quote from @Michael Baum:

Quote from @Patrick McCann:

Quote from @Michael Baum:

I think it would be fun but I no longer have the ability to be as involved as running a small hotel.

We came close to buying a 24 room BnB in New Hampshire a long time ago. Had a restaurant and a small bar. Very cool place but decided to stay put rather than roll the dice.

No longer in the cards for us.

 Where in New Hampshire?

North Conway baby!

It's the Cranmore Inn. https://www.cranmoreinn.com/

 My grandparents owned the kanc motor inn in Lincoln till I was about 6, really wish they hadn’t sold it or that my dad or uncles would’ve had any interest in real estate and buying it. 

Anyways, far out goal for me but I’d really like to get a property at some point whether it be one with many bedrooms or multi unit probably in the Bethel, Maine area that would provide a more affordable place for people like myself to stay that are passionate about skiing/boarding/mountain biking to stay that work regular jobs where either they have to work a ton of over time to afford a weekend away at the mountain and have no time to actually do it, or have the time but not the money. There’s still properties in the sunday river area that aren’t all that expensive just not in the immediate area of the mountain

Quote from @Michael Baum:

I think it would be fun but I no longer have the ability to be as involved as running a small hotel.

We came close to buying a 24 room BnB in New Hampshire a long time ago. Had a restaurant and a small bar. Very cool place but decided to stay put rather than roll the dice.

No longer in the cards for us.

 Where in New Hampshire?

Hi Matthew, 

I am a Boston union ironworker. Unfortunately not the person to be your mentor. I'd eventually like to pursue off market leads as well, but as you're probably familiar with between the job and rehabbing the duplex I currently own myself the time isn't there. Good luck in finding leads and feel free to reach out anytime!

Hi Zackery,

I'm 9 months into my first househack duplex here in NH that I purchased with an FHA loan.

My first mistake would be thinking I wasn't ready or that I couldn't afford to purchase my first small multifamily property to househack which was something I knew I wanted to do long before I ever actually started educating myself about real estate or new that househacking was a term for what I wanted to do.

Second mistake would be not looking into an FHA 203k loan as I didn't know much about that loan product before I decided to jump into my first property. The 203K loan allows you to purchase a property that does need work and adds the construction cost into the loan while still only putting down 3.5%. The loan will require you to get a 203K consultant which is someone who will help you manage the construction of the project along with come up with a scope of work. The mortgage lender pays the contractors directly after proof the work has been completed. I'm not an expert so I would do your own research to verify and learn more information, but that loan product could allow you to get a deal on a property with a value add component without being handy. My property though livable did need a good amount and I'm still working along with spending alot of my own money to complete these projects. I am very handy though so I've been able to do a majority of the work myself.

Hi Nick,

I currently househack a duplex in Dover. During the closing process I had thoughts of whether or not I picked the right property, if it was a good investment etc. Purchased in December 2022 so with the interest rate, PMI, high property taxes in the area the PITI is a pretty big number, but great part about seacoast are of New Hampshire is rents are fairly high too and there's a lot of people looking to rent. Tenant covers 2/3rds of the mortgage so I get to live in an area I like for much less than what it'd cost to rent, and when I move onto the next property it will definitely cashflow pretty well! Also have been doing quite a bit of value add to the property slowly. My opinion I think NH is great market to invest in.

Quote from @Jaylan Archer:

You can definitely use an FHA loan with 3.5% down to buy a four unit, but that is a limit. Past 4 units you are getting into commercial property and just about everything with loans significantly changes.

I would stay with FHA though. I know it is going to make your offer less competitive but the multi-family market in Dover already is super competitive. There's currently 4 active multi-family properties in Dover in a town of 33,000+ people. I'd try the off market route. Drive for dollars, find long distant property owners and start sending letters.

I just had some clients find a terrific four unit that was off market and definitely cash flowed well. They were able to use an FHA mortgage and didn't have to compete with a line of open house attendees.

Wow, sounds like your clients found an incredible deal! Congrats to them!

3-4 units are very difficult to make work in the area with an FHA loan because of the FHA self sufficiency requirement where 75% of the rent income has to cover the mortgage payment which is challenging. Current below market leases that you have to honor on the properties, current interest rates, etc make it difficult to meet that self sufficiency. I am currently living in a duplex I purchased late December 2022 using an FHA loan. I've been following the Dover market closely if you have any questions! tomorrow 7/10 is the New Hampshire seacoast Real Estate Investor meet up at Chapel + Main in Dover. Have you checked with Holy Rosary Credit Union? I've heard of people having good success with them.