First-time buyers · Greater New Orleans

Buy a brand-new duplex with 3.5% down.

Live in one side. Rent the other. The same FHA loan that buys a starter house buys a two-unit building — and the second unit starts paying you back the month you hand over the keys.

The FHA loan was never only for houses

Most first-time buyers think FHA means a single-family house. It does not. FHA finances properties of one to four units, at the same 3.5% minimum down payment, as long as you live in one of them.

A duplex is two units. Same loan. Same down payment. One building, one mortgage, one closing — and a tenant on the other side of the wall.

The rule that makes the duplex the smart choice

This is the part almost nobody explains, and it is the single best argument for building two units instead of three or four.

FHA applies a self-sufficiency test to properties with three or four units. To pass, 75% of the total rent from all units has to cover the entire housing payment — principal, interest, mortgage insurance, taxes, homeowners insurance and any HOA dues. With today's rates, plenty of triplexes fail that test, and FHA will not finance them.

Duplexes are exempt. The self-sufficiency test does not apply to two-unit properties at all.

So the duplex is not a compromise between a house and a fourplex. It is the largest FHA property you can buy without having to clear the hardest hurdle FHA puts in front of buyers.

The loan limit is not your problem

For 2026, the FHA limit in Louisiana — Orleans Parish, Jefferson Parish, the whole state — is:

A turn-key build at $322,000 plus a typical lot lands you somewhere near $372,000. That is barely over half the ceiling.

Which means the limit never boxes you in. You have room for a larger model, better finishes, or a stronger lot and you are still nowhere near the cap. Most buyers spend their whole search worrying about a limit that was never going to touch them.

Rent can help you qualify

Here is the part that surprises people: lenders can count a portion of the projected rent from the second unit toward the income used to qualify you. You are not judged only on your paycheck — the building helps carry itself on the application.

How much counts, and how an appraiser establishes market rent on a building that does not exist yet, is your lender's call. It varies. Ask early, because it can change what you can afford.

What FHA asks of you

• You live there. One of the two units has to be your primary residence — generally within 60 days of closing, and for at least the first year. This is not a loan for a pure rental.
• Credit. Most lenders look for a score around 580 for the 3.5% down option. Lower scores may still qualify with more down. Lender overlays vary.
• Mortgage insurance. FHA charges an upfront premium and a monthly one. The monthly premium generally stays for the life of the loan unless you refinance out. Budget for it — it is the real cost of the low down payment.
• The property has to meet FHA standards. On new construction to current code, this is rarely where deals die.

FHA or VA — which one is yours?

If you served, compare both before you choose. A VA loan needs zero down instead of 3.5%, and carries no monthly mortgage insurance at all — which over thirty years is a large number. See the VA duplex page.

If you did not serve, FHA is your path, and 3.5% is the lowest door into a two-unit building that exists.

Don't have a bank? We'll help you find one.

We have built relationships with a number of banks and loan officers across the New Orleans area. If you don't have a lender, we connect you with ours, and we keep making introductions until we find one that fits what you are trying to build.

To be clear about what that means: we are not the lender. We do not approve your loan, set your rate, or decide what you qualify for — the bank does all of that. What we do is make sure you are not calling around blind. And if you already have a lender you trust, bring them. We will work with whoever you choose.

From consult to keys

Where we build

New Orleans · Metairie · Kenner · Slidell · Covington · Mandeville · Westbank

(504) 407-3199 · [email protected]