FHA/ House Hack Refinance

[TJ Dowhan]

Would appreciate any insight from people who understand or have been in similar situations. I purchased a duplex in the Cleveland, Ohio area almost 1 year ago through an FHA Loan and have been house hacking since. After I come to one full year in this home, I would like to refinance, move out, rent out the space I am currently in, then purchase another duplex and continue the same process.

Am I correct in assuming, I need to wait one year to refinance out of the FHA Loan?

Will I be able to count income from my current property after refinancing and finding another renter to occupy my space?

The area I am in right now has appreciated relatively significantly just over the past year. I would like to stay in the same area that I am currently in because I enjoy living here.

Any hidden fees or pitfalls that I should be aware of as I go through this process?

Appreciate any insight on this topic. Thank you!

[Brittany Woosley]

Hi TJ, Nicely done on the house hack! Not sure if you got this answered yet but wanted to chime in. I refinanced out of an FHA loan a little over a year after purchasing in order to get into another one here in Cleveland, OH. A lender would be able to give you specifics, but as long as an appraisal shows enough equity in the property you should be able to refi out (my experience I needed to show 20-25% equity, which I achieved through forced appreciation/rehabbing it). As far as using the rental income...My lender was able to use 75% of the rental income on the property toward qualifying me for a new loan (I needed to show the signed lease agreement and claim the rental income on my taxes). Definitely talk with a lender so they can look into your specific situation and give you more detail regarding using the rental income, refi fees, etc.