3-Family No Down Payment

Scenario: 3-family brand new home with no down payment. Is this loan doable? Can anyone direct me to a company that does this kind of loan? thanks! :-[

Yes depending on the details. sent you a pm…

Definitely doable, but it depends on many other factors:

How is your credit?

What is the purchase price?

INvestment property?

Do you own your primary residence?

What state are you in?

Are you employed? Have you been in the same line of work for at least 2 years?

Do you have “reserves”- money in the bank, verifiable, after closing.

These are just a few questions that a good broker will have to know before we can determine if you can get 100% financing on this property.

Thanks very much for your response. I am a realtor and I’m actually inquiring on behalf of my client. He was prequalified for 100% financing for a 2-family which he had originally made an offer on. Unfortunately, the seller accepted another offer, which led me look for another property for him. This time, the one we found is a 3-family brand new property. However, the AE informed us that my client would need 5% down with a six month verifiable reserve. here are the answers to your questions:

His midscore is 663 and hers is 656

Initial Deposit of $1,000

The Purchase Price is $536,000 with Seller’s Concession of $11,000

Owner Occupied

In New Jersey

They are both employed in the same line of work for over 2 years (continental Airlines for over 6 years and a second job)

They have 4 months reserve money in the bank, verifiable after closing

I need to get this going ASAP. His house is being closed within a week or two. The problem is that, he had a bad experience with his previous agent that as a new home buyer, he bought a Bank foreclosure. For this reason, he couldn’t do any inspection until after it closed, which has caused him to refinance the property twice for renovation in order to obtain the C of O. He put the house on sale because, his daughter and her husband have moved in with them with their two kids, due to some serious reasons. This has compelled them to sell this renovated house to purchase a multi-family. Due to the two refi’s, he is not making anything out of the sale of his current property.

Hope this helps. Please let me know if you have any further questions. Thanks very much!

On the surface, it seems like there should be financing out there for your client. Since the property is owner-occupied especially. As far as reserve requirements, that differs from lender to lender, so it would take a little homework on the part of the lender they are working with to find something for the client. With a little hard work and creativity, this deal should be doable.

rbaxter, can you point me to a lender who can do this loan? I will very much appreciate your help in getting this deal funded.

I personally don’t know exactly what lender would do it, but a good broker should have the resources to find one for you. I can look into it for you if you would like.

This sounds like an easy one to do!


I just checked over several of my lenders guidelines for your clients loan in NJ.

Based upon the information given up to this point, your clients can get a first and second combo loan. This can be done as either stated income or no ratio, if needed. The amount of reserves your client has will be sufficient as long as they have been there for 2 months.

One obstical that they may run into is “payment shock”. This is a comparison of their current housing payment versus the new payment. Even with using a reduced documentation loan, some lenders will have a % cap on this. Please make sure whoever you use is made aware of this. I even have a couple lenders that waive this restriction if your client can verfiy that they’ve made 12 months of consecutive mortgage payments.

Another thought to keep in mind is the credit scores you’ve given us. When was that report pulled and whom was it pulled by? If pullen online and not by a mortgage professional, be prepared that those scores may actually be lower.

There’s still several details to work out but I’m sure if you choose the right consultant for your client to speak with that everything will turn out ok.

Available for any questions or conversations if needed.

Morgan Stanley will do this loan all day long. Full doc, stated, or no ratio.

I sincerely appreciate your inputs. Thank you very much! :slight_smile: