Home Buying in Denver>Question Details

Jason, Home Buyer in Denver, CO

If I'm a first time buyer looking to owner/occupy a three or four plex with a conventional mortgage how much do I have to put down? Is 20%?

Asked by Jason, Denver, CO Thu May 9, 2013

enough? Also if I have to go FHA how much do I have to put down to avoid mortgage insurance?

Help the community by answering this question:


Conventional (Fannie Mae/Freddie Mac) guidelines require you to put 25% down on a 3-4 unit owner occupied purchase.

You can go FHA and put less down, but you're now stuck with Up Front AND Monthly PMI no matter the down payment. If you put 10% down then you can drop the PMI after 11 years. If you put down less than 10% you are stuck with PMI until you pay off the loan or sell the home.
1 vote Thank Flag Link Thu May 9, 2013
Hello Jason,

Great questions and here is the answer.
If you are looking to purchase a 3-4 unti property you will need at least 25% down.There is really no point in doing an FHA loan as that is more your typical loan for is you have little money down. Even if you did put 25% down on an FHA loan you would still have PMI (private mortgage insurance) as this is required by FHA regardless of the amount down as it is a set PMI rate for all FHA mortgages.

Please feel free to conatact me with any additional questions.

I hope this helps!
1 vote Thank Flag Link Thu May 9, 2013
Hi Jason,

There are some great answers below. Just one thing to add: FHA is changing their mortgage insurance regulations effective June 3 - so you'll want to get a property identified and have your lender pull an FHA case number prior to that date. Ask your lender about the changes, or contact me to visit with one of my Affinity Partner lenders.

Jean Stevens
Broker/Owner, CRS, MCNE, E-PRO, GREEN
The Stevens Group
0 votes Thank Flag Link Fri May 10, 2013

What a good choice to purchase a multi-unit place to occupy. I started out with a duplex many years ago and it was a good decision for me. Since then and more recently the lender rules continue to change as to down payment, interest rates, mortgage insurance, etc. I recommend my best lender who has all the details and is easy to work with. Joe Massey - 303-809-7769. Let me know if there is anything else I can do to help.

Robert McGuire
Your Castle Realestate
0 votes Thank Flag Link Thu May 9, 2013
Let me know if you need any help locating the 3 or 4 plex. I have a property that might meet your parameters.

Andy Eisenbaum

Irontree Real Estate
(303) 335-9801
Web Reference: http://www.IrontreeRe.com
0 votes Thank Flag Link Thu May 9, 2013
25% down, I would look at FHA, but no matter how much you put down , FHA requires mortgage insurance. Compare the mechanical costs of rate, and even with mortgage insurance, you may feel better to leverage your money by going FHA in lieu of Conventional. However, sitting with the right lender they will educate you on pros and cons of both.

Ray Wiliams
Branch Manager
Summit Mortgage
Denvers 203K Lender
2012 & 2013 5 Star Lender
0 votes Thank Flag Link Thu May 9, 2013
The Fannie Mae My Community program is going to allow for the smallest down payment on a multi-unit property with 5% down if you qualify. If you would like more info and to get prequalified send me an email at nnetherton@houseloan.com and I'd be happy to assist.
0 votes Thank Flag Link Thu May 9, 2013
On three and four units this is not the case.
Flag Fri May 10, 2013
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