New Loans Give Minneapolis Duplex Buyers A 5% Down Option

Starting Saturday, November 18, Fannie Mae will accept 5% down payments for owner-occupied duplexes, triplexes and fourplexes.

This is big news. Previously would-be buyers could either purchase using a 3.5% down payment FHA loan, which was accompanied by a stiff mortgage insurance premium, or were required to put 15-25% down. This differs substantially from the many low-down payment options available to single-family home buyers.

The new rules apply to standard purchases and refinances where cash isn’t taken out.

In another bit of good news, the FHA rule for self-sufficiency, where a triplex or fourplex had to have the ability to support itself financially in order to qualify for a loan has been eliminated. That should open up a lot more opportunities for buyers.

And if you’re a current duplex owner who’s lived in your property for the lender-required amount of time, this provides an opportunity to acquire another with a low down payment.

If you’re interested in learning how to build long-term wealth or become financially independent, give me a call. One of my favorite parts of being a Realtor is helping people become financially using real estate as a key component of a long-term strategy.