Financing Second Multi Family house

Asked by frogie909, Boston, MA Tue Feb 5, 2013

Hey, My question is how much do i have to put down for a down payment on my second multi family home? I currently own a 2 family (which i live in and is primary residence) that was appraised at $375,000 2 years ago... and i owe 266,000 so I don't have "pmi" or any of that stuff anymore.. i also have $12,000 in cash for repairs on new house once i get it. Now i heard for a "commercial investment" i would need down. But for a house that will be my primary residence I need less down like  percent. Now i am not trying to cheat the system at all cause i would actually more into this new residence no problem and rent out my current apartment. And if i do this how and why would this be a hard sell to the underwriter?...putting less down would allow me to buy another house now apposed to saving for another year which is well worth making a move...Thank you... Any explanations or suggestions on how this could be done would be much appreciated.

Eric

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9
Mario Pavli, Agent, Boston, MA
Wed Feb 6, 2013
You would need 20% down and I agree with Richard about keeping the extra money for TLC.

Best Of Luck
1 vote
James Furlong, Agent, Brookline, MA
Mon Feb 11, 2013
Work with an experienced mortgage broker. Lenders will have different programs with different requirements. Be prepared to produce a lot of documentation and information. It is still possible to do what you want to do but it may take some time.
0 votes
Moy Lopez, Mortgage Broker Or Lender, Quincy, MA
Thu Feb 7, 2013
Know the rules, play the game.

Step by step, how to build an empire: You could take out a home equity loan on you primary residence for the down payment on your next mutli-family which will require 25% down. Purchase a distressed property at a discount using a FNMA Renovation loan for investors.

We will finance 75% of your purchase price and construction costs. Now you will have two properties. Then move to the second property. Establish it as your primary residence and season the mortgage for a year so that you can use the new and improved value to refinance the mortgage and get some cash out or get a second home equity loan. Its a slow but sure method.

There are always bumps in the road so make sure you work with a reno loan specialist.
0 votes
CH Naamad, Agent, Boston, MA
Wed Feb 6, 2013
Please contact Rich Clayton. He works miracle: rclayton@msamortgage.com
0 votes
Richard Shap…, , Framingham, MA
Wed Feb 6, 2013
If you are so keen on getting another property focus on a single family that may need some tlc. You could get minimum financing assuming you have some reserve $ saved.
0 votes
Richard Shap…, , Framingham, MA
Wed Feb 6, 2013
4 units or less is residential. 5 units plus is commercial needing at least 20 % down.
0 votes
frogie909, Home Buyer, Boston, MA
Wed Feb 6, 2013
i meant to say in this...Commercial investment is %20Percent down( correct?) and if i do primary resident some how it is %10percent down
0 votes
Richard Shap…, , Framingham, MA
Wed Feb 6, 2013
It would be a hard sell because you're moving from one multifamily home to another. You could make a case if you're moving from a multifamily home to a single-family home. What you're doing right now is a lateral move. If this other home is very close to your current home I don't see how you could ever get this done without calling it an investment property
0 votes
Stacie Chand…, , Worcester, MA
Wed Feb 6, 2013
Hi Eric.

That is definitely a mortgage question. So I have forwarded your question to a Senior Mortgage Planner, Sean Callan, with Drew Mortgage (scallan@drewmortgage.com). Once he get's back to me with the answer, I will pass it along to you.

Enjoy the day.
0 votes
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