If you have a big family or if you planning to live in one unit of a home and use the rest one for other purposes, then buying a multifamily home will be the right choice for you. But buying a multifamily home needs a huge investment. Worried about finance? Well, opt for FHA multifamily family and realize your dream of homeownership. The FHA will insure your loan while the lender will approve it. Besides, you can get approval as low as a 3.5% down payment.
So, you can easily apply for an FHA loan multifamily 4 units with a 3.5% down payment and buy a house of your dream. You can consider this real-life example, where a house was sold on 12/13/2019 at 3714 Gager St, Houston, TX 77093 for $450,000 with 6 bedrooms and 6 bathrooms and the total size of the MultiFamily of 4 Units home is 3,564 Sq Ft. With FHA Loan Multifamily 4 Units, the down payment would be only 3.5% or $15,750 and the loan amount is $ 258,138 and the cash to close including closing costs could be $12,009.01.
But you have to be careful when applying for the loan and make sure not to make any of these mistakes –
- Not figuring out how much house you can afford
Without knowing how much house you can qualify for, you might be wasting your precious time. You could end up looking at the multifamily houses that you can’t afford, or visiting homes, which are below your optimal price level. For many first-time buyers, the objective is to purchase a house and get an FHA loan with a comfortable monthly payment that will not keep them up at a night. So, sometimes it is better to aim low. Wondering how to avoid this mistake? Use a custom-designed mortgage calculator online for this. And to know more, visit https://www.clearlending.com/en/calculator.
- Getting just one rate
Shopping for a mortgage is just like shopping for a car or other expensive items – you need to compare offers. Mortgage interest rates vary from lender to lender and do so fees including discount points and closing costs. To avoid this mistake and crack the best deal possible, ask for quotes from different FHA-approved lenders, compare them, and go for the ones that will be suitable for you.
- Not checking credit reports and correcting the errors
Mortgage lenders will check your credit reports when deciding whether you are eligible for an FHA multifamily home loan program and at what interest rate. If there are errors in your credit report, you may get quoted at an interest rate that is higher than what you deserve. So, it is important to ensure the report that you provide the lender is free from any errors. To avoid this mistake, request a free credit report each year from each of the three main credit bureaus. If you notice any mistake, take steps to correct the errors.
- Shopping for a house before a mortgage
It is funny to look for homes before talking about your finances with a lender. But it is what most of the first-time homebuyers do. They visit properties before finding out how much they can borrow. Then, they disappointed to find out they are looking in the wrong price range. To avoid it, talk to a mortgage professional about getting pre-qualified or even preapproved for a home loan before you seriously start to shop for a house. It will help you in the long run.
Making mistakes when opting for an FHA multifamily home can drastically affect you. So, when you go for applying for the loan, be careful, and ensure not to make any of the mistakes.
Author Bio: Joan Gallardo, a Senior Loan Officer, with 20+ years of experience, here writes on 2 questions to ask the best mortgage lender in Houston when you are about to choose one of the first time home buyer programs in Houston.