Home Buying in Milwaukee>Question Details

Nick G, Home Buyer in Milwaukee, WI

Can I get a mixed-use (residential/commercial/retail) zoned property with a FHA loan and also get the first time home buyer's credit?

Asked by Nick G, Milwaukee, WI Tue Feb 9, 2010

I am looking to purchase my first property in the near future (before the tax-credit expires) around the milwaukee area but I would also like to homebrew to produce beer to sell one day from residence property. So, I think I need some kind of multi-use zoning. Would this be possible under a FHA loan and be able to take advantage of the first-time home buyer's credit?

Help the community by answering this question:


If it is primarily commercial or is obviously a commercial building the answer is most likely no. Aside from the easy to understand and calculate 25% cap on commercial SQFT, FHA has some very odd and subjective wording with regard to "is eligible only if the type or extent of the nonresidential use does not impair the residential character of the property."

A. Design Limitations.
1) Any nonresidential use of the property shall be subordinate to its residential use and character. A property, any portion of which is designed or used for nonresidential purposes, is eligible only if the type or extent of the nonresidential use does not impair the residential character of the property.
2) Areas designed or used for nonresidential purposes shall not exceed 25 percent of the total floor area.
Storage areas or similar spaces which are integral parts of the nonresidential portion shall be included in the total nonresidential area.

Noah Newbegin
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0 votes Thank Flag Link Wed Aug 1, 2012

Use web reference below as starting point or call IRS to clear your mixed zoned property as home buyer worthy.

Call around to a few mortgage brokers who can answer your loan questions. And to get the best rates.

Then, good luck.....
0 votes Thank Flag Link Thu Feb 11, 2010
Nick contact a local and trusted mortgage broker who offers fha loans. They will be able to provide you the guidelines for an fha loan. You can also go to http://www.hud.gov for questions on fha financing. good luck with your search.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Wed Feb 10, 2010
I know fha has a program for multi use properties but it has significant restrictions. The properties have to be self sufficent with its own electric ,own plumbing, own entrances , and own parking. It is best to talk to a lender that handles fha loans. Most likely will have to be a large lender. Early last year I tried to find a lender that would handle a simular situation, but was unsucessful.

My quess on the home purchase tax credit is that the precentage of the properties value that is residential would be eligible for the tax credit. So it the property is $100,000 and $50,000 is residentail, only$50,000 would be considered for the tax credit application. It is best to discuss the tax credit with a tax proffesional.

Good Luck
Certified Distressed PRoperty Expert
MEtro Milwaukee

0 votes Thank Flag Link Wed Feb 10, 2010
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