FHA Mixed USE and Non Residential Use of The Property Mortgage Secret

Today, I am going to discuss FHA mixed-use property. I decided to make the video when I saw a competitor’s flyer about mixed use property. I asked a loan officer from the competitor about this program, and he was was a deer in headlights. He had never done one of these before. On a quick Google search, I found an appraiser forum, and they too were confused. I put on my Superman cape and took it upon myself to read the FHA handbook, my company’s intranet, and have scoured Google to give you the best answers in plain, human talk.

A standard FHA loan called a 203B HUD, allows for mixed-use properties, as long the commercial space is 25% or less and the property has residential characteristics. However, closets and storage space will be counted as commercial area.

The mortgage secret is that HUD allows on FHA 203k loans – that is, FHA loans with greater than 35,000 in construction – a higher percentage of commercial area. Specifically, it’s two stories 49% and three stories 33%. The construction money cannot be spent on the commercial area. You cannot use the money on luxury items, tree houses, saunas, barbecue pits – all the ways guys waste money. With the greater commercial square footage comes a property with more commercial characteristics.

To get your questions answered about FHA Mixed Use Loans and commercial properties, call me – Phil Ganz – directly 617-529-9317.

Phil Ganz (117 Posts)

Philip D. Ganz is a Boston Mortgage Broker and Boston Home Loan specialist. For information, expertise, consulting, or advice about home loans, refinancing mortgages, or commercial property loans, contact Phil with no obligation: 617-529-9317


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