Know about assets criteria and limits

Many homebuyers fool around with FHA finance to purchase single-friends belongings. FHA money is actually appealing to homeowners as they keeps lower down repayments plus large borrowing from the bank terminology, which make homeownership more affordable.

You can even have fun with FHA finance to get a good investment or leasing possessions. There have been two important constraints to understand not. The first is the property have no more than five (4) rental units total. The second is that you should take one of many units regarding the assets as your first house.

You’ll also need to meet your lender’s borrowing from the bank, earnings, and financial standards to truly get your application for the loan acknowledged. Keep reading for additional information on purchasing a rental assets with an enthusiastic FHA mortgage.

The fresh down payment conditions for choosing a home having rental units are identical because the standards to have unmarried-family unit members residential property. You could potentially constantly make an advance payment as low as step three.5% of one’s cost if you have a credit rating from at the least 580 and higher. Your routinely have to make good 10% downpayment in case the credit history try below 580.

Eg, imagine we would like to buy a duplex you to definitely will set you back $375,100.