Question- Legal 1 v. 2 Family Homes
We are in the market for a brownstone in Park Slope and are finding quite a few homes we really like. The problem we are finding is that most are zoned as legal 2 family homes; downpayment requirements for these homes seem to be 5-10% (and in some cases higher) than single family and most…
We are in the market for a brownstone in Park Slope and are finding quite a few homes we really like. The problem we are finding is that most are zoned as legal 2 family homes; downpayment requirements for these homes seem to be 5-10% (and in some cases higher) than single family and most have lower LTV requirements for renovation/HELOCs/second mtgs. We intend to use the property as a single family. Any advice / suggestions from the forum? Seems that given our genuine intent is to use the home as a single family, there should be means of getting to the lower downpayment. Hoping the collective knowledge of the forum can help us out… Thanks.
Yes, you can buy a house in Brooklyn with any down payment as long as you can get a mortgage. Condos and coops are another story.
Can you get an offer accepted with that kind of DP for anything reasonably desirable in BK? As my handle suggests, I’m from the other side of the creek, and I’m curious. I can’t see a seller going for less than 20% down it in my hood unless the property was fairly undesirable.
BHO, subprime areas have already declined 40 percent or more from 2006. Prime areas 20 percent. Just like the “historic fundamentals” you cite.
Would OP consider a house in PLG? Isn’t that the area where the historic district is zoned (yes, zoned) ONLY for one family houses?
If you are doing conforming loans you can borrow 80% because the PMI companies won’t insure 2-4 units. You can do 95% on 1 unit properties. This is for conforming amounts listed below. Not conforming jumbo.
1 unit 417,000
2 units 533,850
3 units 645,300
4 units 801,950
Conforming Jumbo will do 90% on 1 unit and 75% on 2-4 units to these amount
1 unit 729,750
2 units 934,200
3 units 1,129,250
4 units 1,403,400
Rates on conforming jumbo are about .25% higher in rate than conforming. Fannie and Freddie have a 1 point overlay for 2-4 unit properties that you can also build into the rate resulting in about .25% higher or you can buy it out by paying the 1 pt
FHA will allow 96.5% for all the above scenarios so technically you can get a 1.4 million loan amount up to 96.5% of the purchase price on a 4 unit.
CAVEAT for 3-4 units, not 1-2 units.
FHA loans require 3-4 unit properties to be self sustaining meaning that the total rents including your unit have to be more than 85% of the Principal, Interest, Taxes and Insurance aka the Full Mortgage payment. This sometimes causes issues for the higher LTV and large loan amounts on the 3-4 unit houses. 85% because they want to protect against the vacancy factor.
There are some portfolio lenders that will do 80% on 2-4 unit jumbo loans but their 30yr fixed rates are higher than the FHA even with the MI, although their ARMS are not too bad.
Adam Dahill
adahill@wcslending.com
I’m assuming the OP is talking about frame houses between 3rd and 4th (or maybe above 4th but close to Prospect Expressway).
0.80 (20% decline so far) x 0.625 (37.5% to go) = half off
You didn’t get that all this time, DIBS?
I can’t get enough of your key word: Yet
Don’t get me started on the shadow tsunami, now bottle-necking due to the robosigning mess and impending 90+ day foreclosure moratorium (and title insurance strike). Mortgage finance is about to lock up! Cash sales only.
***Bid half off peak comps***
yeah, FHA for 1-2 family in Park Slope? really? or is this some fringe hood claiming to be Park Slope?
37.5%, BHO?????
Astoundingly precise!!!! Yet so far totally inaccurate. based on what???
Shadow inventory??? BWAHAHAHAHAHAHAHAHAHAHAHA