Cash Needed to Close on a FourplexApr 13, 2021
What is the initial cash needed to close on a build-to-rent fourplex investment? Are there ways to "house hack" or come in with a smaller downpayment?
The way these properties are structured, it's not really a house hacking opportunity. Your minimum downpayment requirement is going to be 25% of the final purchase price. This is consistent with the Fannie Mae, Freddie Mac down payment guidelines for an investment property (fourplex).
VA financing and FHA financing, which is three and a half percent down is also not really an option for new-build four-unit properties. FIG properties don't meet the criteria, and the builder is not geared to spend a lot of time getting the qualifications necessary for those types of programs.
If you're looking to purchase a new construction duplex, triplex, or fourplex, plan on 25% down. The costs associated with construction financing are detailed on our proformas. We do our best to let you know what your cash to close will be, so become familiar with that document and follow the projections listed by the FIG team.