Bet you are wondering how this all works, cause You, as a first time homebuyer, can purchase property and have someone else pay your mortgage.
There are properties here in Salt Lake, Tooele, Utah Counties that fall into the first time homebuyers price range that are single family homes with what we call “mother in law” or accessory apts, and multi-family units such as duplexes, tri plexes and four plexes. These properties can be purchased using FHA (that means only 3.5 % down), and utilizing all the first time homebuyers programs, as long as you live in one unit, but you can rent out the others.
How does that work for you?
Well, you qualify for your mortgage with FHA just like normal, but with the advantage of adding the rental income into your qualification. So, you can actually qualify for more house with the same income. (call me for details on that one).
So, for an example, with a mortgage payment of say $1400 ( principal and interest, taxes and insurance), if you lived in a duplex or a single family home with a mother in law apt, you could rent the other side for $750 to 800 and be paying only $ 550-600. A Tri plex or 4 plex could have all your mortgage paid and be paying you a monthly income!
Great Part About Buying A Multi Family Property
The great part of this scenario of buying the duplex, tri- plex or 4 plex is that you are establishing your own rental history as well as getting paid (not a bad deal) and after a year or so, you can keep that duplex, tri plex or 4 plex as part of your portfolio and move on to a new home. Now you can qualify for a larger home because you can use actually use the rental itself as well and it’s income as leverage to help you qualify.
In addition, if you are in a positive cash flow before you decide to move up, use that money to save up a down payment for your new place.
Now, there are good’s and bad’s to being a landlord, so you should think this over and weigh the options carefully. But if you want to get a leg up in the passive income area and start your portfolio for say retirement or college fund or …the yacht you want, purchasing a duplex, triplex or 4 plex property, living in one unit, then renting out the others, is a great way to go!
The trick is buying it right…and that’s where we come in. We can help you analyze the cash flow, and buy at the right price to help you meet your goals! If you want to try it out…give us a call…we will be glad to discuss options with you! Now…click the link below to get started!