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Hi all,
How much down payment would I have to put down on an out of state real estate purchase? (this would not be my primary residence, I currently rent in VA) I heard it would be 25% down...is that true? Also, if I made this purchase (in SC), could I still buy a primary residence (in VA) with an FHA loan?
It doesn't matter if it's in state or out of state, but if it's investment property, not primary residence, it's going to be 25% down. There are very few lender who allow for 20% down these days.
Yes, if you qualify, you would still be able to obtain an FHA loan.
I just went through this a few months ago. You can have (in NJ, at least) up to 4 conventional mortgages whether they are for a primary/secondary/investment property and only be required to put 20% down. UNLESS the property is a multi-family with more than 2 units - then it's automatically a commercial loan with a min of 25% down required.
Once you have those 4 mortgages , for any future purchases, the banks want you to take out a commercial loan and put 25% down. This way they get to screw with your mortgage rate 5 years in to the mortgage.
There is no "standard" anymore, but the bulk of my investors are all required to put down 25% and they have great assets and high scores. I haven't seen a 20% down investor loan in my area in a very long time. However, one of my buyers just got approved for 20% from a credit union, though the last one he bought had to be 25% down. 20% is very rare these days.
And I've never heard of needing a commercial loan on a single family residence. That doesn't even make sense. A house is a house and a commercial building is a commercial building. Completely different.
It doesn't matter if it's in state or out of state, but if it's investment property, not primary residence, it's going to be 25% down. There are very few lender who allow for 20% down these days.
Yes, if you qualify, you would still be able to obtain an FHA loan.
I dont think 25% is even close to standard.
A friend of mine just put down 5%. Not the norm, but just shows the variability depending on financial situation and occupation. I would guess that the average is 10-20% down.
I just went through this a few months ago. You can have (in NJ, at least) up to 4 conventional mortgages whether they are for a primary/secondary/investment property and only be required to put 20% down. UNLESS the property is a multi-family with more than 2 units - then it's automatically a commercial loan with a min of 25% down required.
Once you have those 4 mortgages , for any future purchases, the banks want you to take out a commercial loan and put 25% down. This way they get to screw with your mortgage rate 5 years in to the mortgage.
Thanks for the info Sawdustmaker, what do you mean by "they get to screw with your mortgage rate 5 years into the mortgage"??
A friend of mine just put down 5%. Not the norm, but just shows the variability depending on financial situation and occupation. I would guess that the average is 10-20% down.
You know someone who put down 5% on an INVESTMENT property? 5% is common on primary residence, but lenders do not accept 5% down on investments.
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