Exciting news for buyers looking to get into the market. You can now put down 5% and get a conventional loan on a 2-4 unit multifamily property. Before this, there was a 3.5% down FHA product for multifamily, but then you have all the FHA guidelines to deal with which made it very difficult to buy 3-4 unit properties due to what was known as a self-sufficiency test. Getting a conventional loan with a low down payment option on multifamily is very exciting for the real estate world!
The term house hacking has been all over the media over the last few years due to Bigger Pockets coining the phrase, and what that means is buying a property with more than one unit and renting out the rest in order to offset your mortgage. In some housing markets, a buyer could even cash flow positive using this strategy – not so likely here on the peninsula, but never say never.
The loan limit is nearly 1.4 million on a four-plex, so for buyers looking for a 2-4 unit in Seaside, Monterey, or Pacific Grove, this will be an incredibly valuable loan product to have in your arsenal.