House Hacking a 2-4 Unit Home: FHA, VA, Fannie and Freddie Rules
Buy a duplex, triplex or fourplex, live in one unit and rent the others. Here are the official down payment, move-in and rental income rules for each loan type.
Every item cites an official source (HUD, VA, Fannie Mae, Freddie Mac or FHFA) and the date we checked it. Last checked Nov 10, 2026.
Official, in effect Quick comparison
| Loan | Lowest down payment | You must live there | Extra rule to know |
|---|---|---|---|
| FHA | 3.5% (credit score 580+) | Move in within 60 days, plan to stay 1 year | 3-4 units must pass a rental "self-sufficiency" test |
| VA | $0 if the price isn't above the appraised value | Yes, personally, within a reasonable time | Up to 4 units; funding fee applies |
| Fannie Mae | 5% (95% LTV through DU) | Move in within 60 days, stay 1 year | Lower limits for high-balance and manual loans |
| Freddie Mac | 5% (95% LTV with an LPA Accept) | Must be your primary residence | Manual: 85% LTV for 2 units, 80% for 3-4 |
Sources: HUD Handbook 4000.1 · VA.gov: Purchase loan · 38 U.S.C. § 3704(c) · Fannie Mae Eligibility Matrix (Aug 5, 2026) · Selling Guide B2-1.1-01 · Freddie Mac: Maximum LTV ratios · Checked Nov 10, 2026
Official, in effect FHA: 3.5% down, plus a test for 3-4 units
FHA insures 1-4 unit homes. The purchase limit is 96.5% loan-to-value, so the minimum cash investment is 3.5% (for credit scores of 580 and up; 500-579 is limited to 90%). At least one borrower must move in within 60 days of closing and plan to live there at least one year. FHA won't insure a deal designed to get investment properties through FHA.
Self-sufficiency test (3-4 units): take the appraiser's fair market rent for all units, including yours, and subtract the larger of the appraiser's vacancy and maintenance estimate or 25%. The monthly payment (principal, interest, taxes and insurance) can't be more than that net rent.
For 3-4 units, the lender must also see 3 months of payments in reserves after closing. FHA loan limits depend on the number of units and your county, so look yours up with HUD's FHA limit lookup.
Source: HUD Handbook 4000.1 (Aug 12, 2026 update): occupancy, 3-4 unit self-sufficiency, reserves, LTV · Checked Nov 10, 2026
Official, in effect VA: no down payment, and you must live there
VA says an eligible Veteran or service member can use a VA-backed purchase loan to buy a home of up to 4 units, with no down payment as long as the sales price isn't higher than the appraised value. There's no private mortgage insurance, but a VA funding fee may apply.
Federal law requires you to certify that you'll personally live in the home, meaning you live there now or will move in within a reasonable time after closing. A home you won't live in can't be bought with a VA purchase loan.
Sources: VA.gov: VA-backed purchase loan · 38 U.S.C. § 3704(c) · Our VA funding fee page · Checked Nov 10, 2026
Official, in effect Fannie Mae: 5% down through DU
Fannie Mae's matrix allows up to 95% loan-to-value on a 2-4 unit principal residence purchase run through Desktop Underwriter. High-balance loans are lower: 85% for 2 units and 75% for 3-4 units. Investment properties of 2-4 units top out at 75%.
A principal residence means you move in within 60 days of closing and live there at least one year, unless the Selling Guide allows otherwise.
Rental income: rent from the unit you live in can't be counted. Rent from the other units can help you qualify, but Fannie only lets you use positive rental income if you have at least 12 months of property management experience. Without it, rent can only offset the property's own payment.
Sources: Fannie Mae Eligibility Matrix (Aug 5, 2026) · Selling Guide B2-1.1-01 (Nov 4, 2026) · Selling Guide B3-3.8-01 (Sept 2, 2026) · Checked Nov 10, 2026
Official, in effect Freddie Mac: 95% with an Accept
For purchases and no cash-out refinances of a 2-4 unit primary residence, Freddie Mac allows up to 95% loan-to-value when Loan Product Advisor returns an Accept (this took effect for loans settling on or after Sept. 29, 2025). Manually underwritten and super conforming loans are capped at 85% for 2 units and 80% for 3-4 units. Investment properties of 2-4 units top out at 75%.
Freddie Mac says rent from the other units can be added to your income when the lender calculates your ratios.
Sources: Freddie Mac: Maximum LTV/TLTV/HTLTV ratios · Freddie Mac Bulletin 2025-12 · Freddie Mac: Mortgages for 2- to 4-unit properties · Checked Nov 10, 2026
Official, in effect 2026 conforming loan limits by units
| Units | Baseline limit (most of the U.S.) |
|---|---|
| 2 | $1,066,250 |
| 3 | $1,288,800 |
| 4 | $1,601,750 |
These are the baseline limits for Fannie Mae and Freddie Mac loans. High-cost counties can be higher. See jumbo vs conforming for the full table.
Source: Fannie Mae: Loan limits (2026) · FHFA: 2026 conforming loan limits · Checked Nov 10, 2026
Local rules: check before you buy
Zoning, rental registration, inspections and short-term rental rules are set by your city or county. Confirm the building is legally 2-4 units (not an illegal conversion) before you count on the rent.
Local rules vary · check with your city or county · Checked Nov 10, 2026
Related tools and pages
2-4 unit and investor rules (Fannie Mae updates) · FHA 203(k) renovation loans · FHA vs conventional (2026) · VA vs conventional (2026) · Down payment help (2026) · Cash flow calculator
General information only. Not legal, tax or financial advice. RentToolkit is not a lender, law firm or financial adviser. Mortgage rules change often and lenders can add stricter rules of their own ("overlays"), so confirm with the official source and a licensed loan officer before you act.