October 16, 2017
Can I buy another house with an FHA loan? It’s a question on the minds of many, especially those who might be concerned that NOT being a first-time home buyer might disqualify them from the FHA loan option. Is this true?
FHA Loans Are Not Just For First-Time Home Buyers
FHA mortgage loans are designed to be an affordable option for anyone who is financially qualified to be approved for a home loan. That means that you do not have to be a first-time home buyer, you don’t have to be “in need” to qualify, and you don’t have to worry about an income limit for FHA mortgages.
FHA loans are approved on the basis of a borrower’s creditworthiness and ability to afford the loan. There is no maximum income limit, there is no advantage or disadvantage to being a new home buyer under the basic rules of the FHA loan program.
Lender Programs May Vary
That does not mean a participating lender won’t offer incentives to first-time home buyers; FHA loans are governed by FHA minimum standards, but also by lender standards. Your participating lender may have a bargain or special offer for you as a first-time home buyer. Be sure to ask your loan officer if any such programs which may apply to your status as a home buyer might be available in your area.
FHA Loans Are For Owners Who Intend To Occupy
So far, we’ve discussed how FHA mortgages are available to any financially qualified applicant who meets FHA loan program minimums. But there is one caveat in all of this; FHA mortgages have an occupancy requirement.
FHA home loans are intended for owner/occupiers and you will, as a condition of loan approval, be required to live in the property purchased with FHA loan funds as your primary residence.
That means that you cannot purchase a vacation home, time share, or investment property with a single-family FHA mortgage. You are permitted to buy a multi-unit property and rent out the unused living units, but you will still be required to live in one of those units as your main address.
Certain Exceptions
FHA loan rules do provide certain exceptions for those who have an increase in family size or are involved in a job-related relocation, but these are handled on a case-by-case basis and you will need to discuss your circumstances with a loan officer to determine what may be possible. Lender standards and state law may also apply in such cases.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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