FHA loan on duplex w/ both units rented until January, possible?

4 Replies

Just as the title says, I'm looking at a possible first property (constructed as a duplex, but I believe legally it's a single family home due to one mailing address, connected utilities, and I believe zoned as such) and I am trying to figure out all the details I'll need to know to get it purchased. 
Basically Both units are being rented for $750/month all utilities included until January. I know I am not going to renew the current leases when the time comes, but until then I have no way to "owner occupy" the home since both units are currently rented. Is it possible to get the FHA loan in this situation?

i believe fha requirements state you must intend to owner occupy within 90 days or something like that. wheb you factor in closing time, i would guess you have more than enough time

@Jacob Barnhart you can stipulate in your offer that 1 of the units must be move-in ready by the close of the contract, then have closing after the lease. Otherwise, you can offer a little higher price and stipulate in the offer that 1 unit must be vacant at closing and pick whatever works. At that point, it's up to the current owner to incentive (cash for keys) a tenant to move to another place. I did the latter one when I bought a fully occupied 3 unit with FHA.

Underwriting will probably cause problems with the loan if both units are leased and the contract does not stipulate anything about you being able to get in there.

side note, I believe you only have to intend to occupy the unit within 60 days. under these requirements, I don't think you would be held liable if the tenant holds over and causes problems....but you should verify that if you think it may be an issue.

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