Can am FHA loan be used for a duplex in Tennessee?

11 Replies

Ok so I'm good friends with a Real Estate agent here in Nashville TN and she told me that in Tennessee I can't use an FHA loan to buy a duplex. I was planning on house hacking it, but she told me the state would consider it an investment property thus making it ineligible for the FHA. I can't find anything saying that I can't do it, so I thought I'd try asking people here instead if it's allowed in TN or not. TIA!

Side note, I'm a new user here, I'm 23 and found out about real estate investing through Graham Stephan on YouTube!

@Austin C Mulholland this agent is not a good one. This would be like buying a car that runs on regular gas and the sales person tells you it's a diesel. Find a better agent. Yes you can do FHA as long as you live in it and it's 4 units or less.

Ask the agent a couple more questions to make sure you didn’t misunderstand. 

You don’t need a rockstar that sells 100 properties a year because you’re new and can’t add value to them (like buying a bunch of houses) but you certainly need someone that knows what they’re doing.

To take it one step further FHA has nothing to do with "Tennessee" the F in fact stands for "Federal" so it's not state specific. Sounds like your agent has to go. Always ask an agent how many properties they own. You can generally google them and see how many they sell. Choosing the right agent is a big piece of the puzzle in the early days.

Another issue is Nashville prices are so high compared to rents that just looking at Zillow will cost you money (that’s a joke). Finding a property that won’t break the bank will be tough. 

Good luck! 

@Lucas Carl thanks a ton, I suspected everything you said was true about the FHA. I've been researching alot for at least the past month. Luckily she's not MY agent but rather a family friend. Nashville is ridiculously expensive right now, but I'm keeping my eyes on the market constantly waiting for something

@Austin C Mulholland

How many properties has your friend bought? I'm guessing this is close to number one. I second Lucas' opinion that as a first time homebuyer you shouldn't be buying with a brand new agent. If you insist, she better be giving you one hell of a kickback.

You can buy a four door with an FHA loan. I have a great mortgage originator, send me a message if you'd like her contact info.

@Austin C Mulholland hey Austin, you can definitely do a 2 unit using FHA if you plan on living in the property. Im currently house hacking in Nashville, and despite what everyone says its still possible to successfully house hack in this market. Happy to chat sometime about it if youd like, and could certainly refer you to another agent if youd like any suggestions. Best of luck, Kyle

@Kyle Deutsch Mann It'd be great to chat with you about it because while I have a general idea of what I want, it'd be nice to talk to someone with experience in the market in more depth about it. I'll shoot you a DM

@Austin C Mulholland

I live in Clarksville, TN and used and the FHA loan to buy a brand new quadplex. We live in one unit and rent out the other.

Your agent might be going off what the lender told them because the first lender told us no, but we went to a different lender for a second opinion and they were able to do it.

Feel free to message me if you have questions. I’m a Nashville Native that grew up in West Nashville!

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here