I guess the reason that 0.75% would make the deal bad is because you are living in one side. By living in one side of the duplex you are eliminating half of the income.
If living in the property is your goal. I would execpt a $100 to $200 negative cash flow. How many people can buy a duplex have a place to live and build up good equity all for $200 a month.
However as a general rule for investing, if 0.75% changes the cashflow to negative that is a bad investment. The numbers should never be so tight that you ask the question “Will I make money?” The question should always be “How much will I make on this deal?”
I am a newbie to real estate investing and I am trying to structure my first deal with the help of my parents as partners. We found a duplex in a nice area in Atlanta with the ultimate goal being for me to live in one side (2Br 1BA) and rent out the other side (3br 2ba). The deal looked good until speaking with FNMA we were informed that it has to be bought as an investment property rather than a home(because I will be living in it). This of course jacked the interest rate by .75 and turned the deal sour. The deal would get a little better only if we laid down 20%, the above rate represents a 10% down payment. I owe it to this site in giving me the push to start this. I really want to make this work but am at a dead end. Can anyone give me any ideas? Let me know if more details are needed.