Real Estate Investor · Jersey City, NJ · Member since 2017 · 8 posts · 0 votes
Can you use a FHA loan after purchasing your first investment property? Or is a FHA loan only for your first time home purchase, regardless of whether or not the purchase is your investment property or primary residence?
For example, I live in NJ and would like to purchase my first rental property in South Carolina. If I choose to go with a traditional mortgage on this property, can I use a FHA loan down the road when I want to purchase my primary residence up here in NJ?
Can you use a FHA loan after purchasing your first investment property? Or is a FHA loan only for your first time home purchase, regardless of whether or not the purchase is your investment property or primary residence?
For example, I live in NJ and would like to purchase my first rental property in South Carolina. If I choose to go with a traditional mortgage on this property, can I use a FHA loan down the road when I want to purchase my primary residence up here in NJ?
Any help would be much appreciated!
Assuming decent credit, there are 95% and 97% LTV conventional options that are generally better financing than 96.5% LTV FHA. Ensure you are working with a lender that will present various options suitable to your needs and situation, not just the one you specifically inquire about.
But, to answer your question directly, FHA loans do not have a first time homebuyer status requirement. You would not be auto-disqualified because you own a rental in SC.
Fresno, CA · Member since 2018 · 17 posts · 11 votes
8y
I am no lending expert nor do I pretend to be one, with that said, typically conventional loans are used to fund investment properties. I believe FHA was designed to get people into their first homes. The home must be owner occupied for 1 year. After that said time period you can technically move out and keep the FHA loan. However If you get caught leaving prior to that 1 year you won't be able to apply for another FHA loan for 2 years (According to my realtor).
I would also encourage you to look up new MIP rules. According to my mortgage loan specialist MIP cannot be canceled if the loan was taken out after Dec 2014. I suggest you speak with a mortgage broker/lender. Also, feel free to correct me on any of the above statements for I am no expert.
Can you use a FHA loan after purchasing your first investment property? Or is a FHA loan only for your first time home purchase, regardless of whether or not the purchase is your investment property or primary residence?
For example, I live in NJ and would like to purchase my first rental property in South Carolina. If I choose to go with a traditional mortgage on this property, can I use a FHA loan down the road when I want to purchase my primary residence up here in NJ?
Any help would be much appreciated!
Assuming decent credit, there are 95% and 97% LTV conventional options that are generally better financing than 96.5% LTV FHA. Ensure you are working with a lender that will present various options suitable to your needs and situation, not just the one you specifically inquire about.
But, to answer your question directly, FHA loans do not have a first time homebuyer status requirement. You would not be auto-disqualified because you own a rental in SC.
Lender · Nationwide Lender · Member since 2015 · 1k+ posts · 814 votes
8y
@Joe Procopio FHA is not for 1st time home buyers. You can certainly own an another property (primary or investment) and buy using a FHA loan. The key requirements for FHA is that its is only for owner occupied purchase AND you can only have one FHA loan at any given time (with some exceptions).