FHA 60-Day Move In Requirement with Existing Leases

[Fallon Richardson]

I have been searching the internet and this site to no avail so I am reaching out hoping that other folks on here may have some insights!

My partner and I are going to be purchasing our first multi-family house-hack in Washington state (specifically Whatcom or Skagit County) with an FHA loan. Our understanding is that the loan requires the unit be owner occupied within 60 days of closing.

My question is If the property is fully rented when we purchase it and none of the leases expire soon  enough for them to vacate by then, is there any way to terminate a lease early? If so, what scenarios would best benefit both parties? Which are the most cost effective?

It seems like most sellers try to get tenants on month to month leases before selling, but this is not guaranteed so we are trying to figure out what options we have in the event that we end up in a situation like this.

Thanks everyone for your input! Happy Investing :)

[Christopher Phillips]

Fallon Richardson

20 day notice for month to month in Washington. If they are on a lease you have to honor the lease.

You can't terminate a lease without "cause" in Washington State

If you give 20 day notice and they don't or can't move out they become a holdover tenant and you have to evict them.

When you take out an FHA loan you sign an owner agreement to be a owner occupant for at least a year. Banks know when you don't live there and you don't want to get hung up in a bad situation.

Options? Pay them to move out.

Or just keep looking... many landlords like to do month to month. You might find the right situation somewhere.