Multiple FHA loans

[George Gipson III]

okay so I am planning to purchase a investment property with a FHA loan the property is being auctioned by the court house it sold for 260,000 in 2007 right now listed at 175,000 for sale. My question is if I purchase with the FHA loan with 3.5% down and I would put more to lower the payments when I decide to sell or rent it out will I be able to purchase another home with FHA loan if I still own the first property while renting it out. I am assuming you can only have one FHA loan at a time and it must be your primary residence. My bank told me if its a investment property I must put 20% down and can't use the FHA loan. What should I do?

[Albert Bui]

Originally posted by @George Gipson III:

okay so I am planning to purchase a investment property with a FHA loan the property is being auctioned by the court house it sold for 260,000 in 2007 right now listed at 175,000 for sale. My question is if I purchase with the FHA loan with 3.5% down and I would put more to lower the payments when I decide to sell or rent it out will I be able to purchase another home with FHA loan if I still own the first property while renting it out. I am assuming you can only have one FHA loan at a time and it must be your primary residence. My bank told me if its a investment property I must put 20% down and can't use the FHA loan. What should I do?

 HI George,

You can only have 1 FHA loan at one time, however there are four exceptions most loan officers aren't aware of. You can get a second FHA loan if:

1) you cosigned on a FHA loan for another individual but you now want your own home

2) you were divorced and no longer cohabitat the home with your ex-spouse and now want to buy your own

3) larger family size and can literally document a larger household now via mammogram, adoption papers, letter of explanation,etc

4) you are relocating to a new area and would like to use the FHA program again and have employer documented relocation papers/job offer

to make any of the above work you need adequate time to plan, documentation, and a loan officer who can sell the above to their underwriter.

Good Luck!