Web Reference: http://www.AFN-Loans.com
A couple of the answers already mentioned FHA financing as a viable choice with the assumption that you will be owner occupied and that your loan will be within the loan limits for the county the property is located which definitely you should consider but more information from you would be needed.
As a clarification though regarding FHA financing and 3 to 4 units it's not the remaining units that must cover the mortgage payments it's all the units combined including the owner occupied one as well as if it will be rented even though it won't. Then it's either based off of the 90% rental factor or operating income statement from the appraisal.
Regardless of that, it goes to show you that for those who mentioned FHA financing as an alternative gave it some thought that it could be a possibility.
Best of luck to you.
There are many scenarios around the situation due to the big difference in loan amounts. I would be happy to run specific scenarios across our investor guidelines.
General 4-plex requirements as a non-owner occupied conventional loan up to $801,950 per Fannie would require a down payment of 25% (IN CALIFORNIA).
Homepath above 2 units my guidelines read a 25% down payment.
As mentioned there are MANY variables with your question. I would be happy to provided you with a free analysis specific to you situation just shoot me a private message to get started.
Web Reference: http://www.loansquawk.com
"If you are going non-owner, you'll need 30-35% down depending on your financials."
... Is completely untrue. You can finance a 4 unit investment property with 25% down per Fannie/Freddie guidelines.
It depends on if you are buying owner occupied. If that's the case you're in luck. The down payment on a FHA 1-4 unit property is a whopping 3.5%. The rents on the other 3 unit MUST cover the mortgage and the underwriter has the discretion to give you up to 90% rental factor without a 2 year landlord history like Fannie and Freddie require. The loan limits are as follows:
The maximum FHA loan limits for most Bay Area counties (the ceiling) by property size for fiscal year 2011 are as follows:
* One-Unit $ 729,750
* Two-Unit $ 934,200
* Three-Unit $ 1,129,250
* Four-Unit $ 1,403,400
If you are going non-owner, you'll need 30-35% down depending on your financials. Please let me know if I can be assistance.
Best of Luck!
Work with someone that can project flows, vacancy projections, expenses is recommended.
We are currently in contract on a multi-unit building and were given the following guidelines:
1. Owner occupy - 25% down
2. Investment property - 35% down
However, keep in mind they do change a lot more than they used to. With regards to how lenders will view rents it depends upon the lender. With regards to what areas, we have recently seen a number of place in the east bay (oakland) area that make sense from a cash flow perspective.
I have a lot of experience in this both personally and for clients so if you want to talk and/or get some lender referrals we regularly work with my contact info is below:
Lance King/Owner-Managing Broker
Great questions and as our industry creates new rules daily my best advise is to speak with a couple different lenders in the area. I can connect you with them if you like. We can also set you up on an automatic MLS search for multiple dwelling listings.
Please work closely with a realtor of your choice to stay current on inventory and lending options.
Good luck to you,
Broker / Owner
DRE # 00350257