Buying a duplex- How does month to month work???

Question

Hey everyone. I've been approved fha to buy a duplex. I will live in one side and rent the other.

I am looking at a duplex that currently has both sides rented at month to month. What kind of timelines/contingencies will me and my realtor need to work with the seller so that one side is vacant for me to live in? How does this process usually go? (When both sides are month to month and one tenant needs to leave for the deal to work fha wise)

Thanks!

Raymond J. Rodrigues · Answer

As @Adam Bartomeo mentioned, one of the units has to be delivered vacant and you need to be able to occupy the property within 60 days. If your realtor or lender didn't tell you that this needs to be part of the contract, in order for you to close, you might want to consider working with someone that has more experience.

Adam Bartomeo · Answer

When a tenant is on a month-to-month lease, depending on the state, the seller would have to give them 30+ day's notice to vacate the property. As an FHA buyer. once you close/own the property, you have 60 days to occupy the property. Your contract should clearly state that closing is contingent upon one side of the duplex being vacant by closing for you to move into.

Michael Smythe · Answer

You should seek advice from a landlord-tenant attorney in the area of the property.

Caleb Brown · Answer

You would add verbiage that unit "x" would be vacant by closing. The seller would give the tenant notice then they would need to vacant. I would have your agent first start dialogue with the other side to verify they would do this.

Ryan Spath · Answer

@Sherelle Montague

Hey, great question this comes up a lot with FHA house hacks.

For an FHA owner-occupied loan, you’re required to move into the property within 60 days of closing. Since both units are on month-to-month leases, you actually have plenty of flexibility because the seller (or you after closing) only needs to give 30-day written notice to one of the tenants.

In my market here in Idaho, it’s very common for sellers to leave the tenants in place and let the buyer handle the notice. The reasoning is simple: if something falls apart during the transaction, the seller doesn’t want to be stuck with a vacant unit. So don't be surprised if the seller prefers to keep things as-is until you’re through inspections and financing.

I recently helped a client with almost the exact same situation here in Boise. They bought a duplex using FHA with the plan to occupy one side. Fortunately, one of the units became vacant before closing, which made the transition super smooth. Unfortunately, that doesn’t always happen.

Just keep in mind: these deals can get tricky if you’re working with someone who doesn’t have experience with house hacks or investment-style acquisitions. Make sure your agent structures the offer correctly, builds in the right timelines, and keeps communication clear with the seller about expectations for occupancy.

Happy to answer any other questions as you navigate it!

Graham Nadler · Answer

Hi Sherelle, congrats on getting started house hacking.  It's a MASSIVE first step to financial freedom and wealth creation.  Typically (but depending on your market) underwriting will require written notice from sellers and potentially with the side of the current signers moving out that they will move out so you can move in within FHA requirement of 60 days with an addendum once you get initial underwriting approval. LMK if you have any other questions!

Rick Albert · Answer

Everyone kind of answered. I typically recommend at least 30 days after all contingencies are due. So if contingencies are due in 10 days, then have escrow be 40.

Something you may want to budget for is as soon as you close, the second unit may give you notice that they are leaving. I would budget accordingly.

Bill B. · Answer

Most sellers wouldn’t want to evict a paying tenant because you say you are going to buy, I certainly wouldn’t. You could offer a non-refundable payment of 3 month’s rent if you fail to close.

Otherwise you usually have 30-60 days to move in after purchase. Check with your lender to get an exact number of days. Then check with your local property manager how much notice you shed to give them to get out and see if you can swing it.

Buying a duplex- How does month to month work???

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