Purchasing a home for a relative to live in. Considered an investor. What percentage of the asking price am I required to put down for a HUD home?

Asked by Ecint51, Sierra Montana, Surprise, AZ Thu Dec 1, 2011

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, ,
Fri Dec 2, 2011
Hi, Ecint.

Would this relative be someone you would want to co-purchase the home with? If so, you can come in with as little as 3.5% down. The occupant-buyer does not even need a job or income in such a scenario, however derogatory credit may prevent that person from being on your loan.

If you are unwilling or unable to have the occupant on the loan with you, then you most likely are looking at 20% down payment.

There are other considerations but this should give you a pretty decent 20,000 - foot view.

If you have questions, or would like to discuss your specifics in detail, I am available at 602-620-1199 or rob@velocityfinancial.com

Good luck with your house hunt!

Rob Riforgiate
Vice President
Velocity Financial, LLC
MB# 908760/MLO# 0912698/NMLS# 227936
Equal Housing Lender
1 vote
Stephanie We…, Agent, Gilbert, AZ
Sun Dec 4, 2011
As an investor buyer, you would be required by your lender to put down 20% or more (usually 25%). It does not matter what type of property you are buying. Good luck!
0 votes
Investor X, , Gilbert, AZ
Fri Dec 2, 2011
Buying any property as an investor. HUD, FHA, Fannie, conventional, Freddy doesn’t matter. You’re stuck with 20% down or more plus a higher interest rate. Did you forget in 2011 banks are not in the bizz of lending anymore. 99% of mortgage guys will yes you to death saying, “Your application looks great to get the loan,” Just wait until it hits the underwriters desk. Apply for the loan and watch what happens. 30 days from now I’ll get an e-mail. Mike you where right.

Sorry but the truth can hurt.

Investor Mike
0 votes
, ,
Fri Dec 2, 2011
An option brought up to you is that you could be a co-signer on the home as a "non-occupying co-borrower" which can be a good way to go, given your goals, however, the relative you are trying to help must be able to qualify, credit wise. If this relative has a short sale, foreclosure &/or a bankruptcy in the last couple of years, they will not qualify & you will not be able to purchase the home this way.
0 votes
Spirit Messi…, Agent, Tucson, AZ
Fri Dec 2, 2011
Are you pre-approved with a lender? What you put down on the contract depends on what type of loan you pick & you qualify for. Unless you want a lender to list all of the options here, it would be in your best interest to call a local lender (I prefer Nova Home Loans) and meet with them. This should be free to do, and you will know where you stand, if you are pre-approved, how much, what the downpayment would be, your mortgage payments and etc.

Best of luck.
Spirit
0 votes
Matt Puzz, , Mesa, AZ
Fri Dec 2, 2011
Why are you considered an investor when buying a home for a relative to live in?

There is a loan called an FHA Non-Occupying Co-Borrower that allows you to buy the howe with the relative with that relative being the primary occupant of the home. Does the relative have credit or income issues, something to thing about (not to mention on this forum). I do these loans frequently and the advantages are many; primary residence, 3.5% down payment, lower interest rates than an investor, fewer asset reserves. Downside is that you would have this mortgage show on your credit report, but if you are an investor or if you buy with the relative you will have the mortgage on the credit report so what......

Give me a call I may have some more ideas for you to ponder.

Matt Puzz
Licensed Loan Originator
Amerifirst Financial, Inc.
602-410-9333
apply online: http://www.mattpuzz.com

Amerifirst Financial is a Mortgage Banker, we originate, process, underwrite, and fund all our loans.
Web Reference:  http://www.mattpuzz.com
0 votes
, ,
Thu Dec 1, 2011
Hi Ecint51,

If I understand your question correctly, you are looking at purchasing a HUD home as an investment property. If this is correct, you will need a minimum of 20 % down if you own less than 5 financed properties. If you own 5 or more properties that are financed, you will need a minimum of 25% down.

The 3.5% FHA & 3% HomePath down payments mentioned below are only for a purchase of a Primary Residence, not for an Investment Property. You can, however, buy a HomePath home as an investment with only 10% down.

Please feel free to contact me if you have any further questions, I'd be glad to help.

All the best,
Ros

Roswell Moore, CMPS
Certified Mortgage Planner
480-422-5095 direct
http://www.ezAZloan.com

We are a Direct Lender, Mortgage Bank where we originate, process, underwrite, fund, AND SERVICE our loans, in-house, with FHA (starting at a 580 score AND still only 3.5% down), FHA Streamline loans (no minimum credit score, no appraisal required) Go Green rehab loans, HomePath, Investor Friendly (10 financed properties), VA, USDA, Jumbo, Conventional, plus, we allow Escrow HoldBacks!
NMLS ID 263779 | AZ BK 359295
0 votes
Rocky Dole, Agent, Maricopa, AZ
Thu Dec 1, 2011
First of all, you need to know that you are at a disadvantage as an investor when purchasing a HUD home. There will be a period of 30 days on most homes that only owner occupants can bid on a HUD. As far as a down payment is concerned it will depend on the type of loan that you get. If you would like more information on types of loans then I would suggest that you contact my loan officer. His name is Ron Sublett and his number is (602) 228-4911 or (480) 305-8730. He would be happy to assist you.
0 votes
Miritssa Cas…, Agent, Cave Creek, AZ
Thu Dec 1, 2011
If the home qualifies for FHA financing 3.5%. For Homepath you can get in with as little as 3%, both represent the down payment. You need to add the closing costs.

In which area in particular are you looking to buy this investment property? How many bedrooms- baths. Maximum price you like to invest. If you provide me this information I can send you all of the available inventory of homes,

Thank you,

Milly Casas

Milly Sells AZ
e-mail: milly@millycasas.com

visit my website at: millysellsaz.com
0 votes
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