FHA loan question about owner occupancy

[Thump553]

Can somebody post the laws/rules for FHA loans in CT? I took one out for my house and I think I got a special one because my downpayment was 0%, but in return I pay a higher interest rate on the loan. I remember them telling me I couldn't sell the house for x years (I think it was 2-3) but I don't remember any rules about renting it out...

Far more important is for you to actually read the relevant portions of your mortgage, or take it to a lawyer if you can't understand it or don't want to make the effort. This is a matter of contract interpretation, the contract being your mortgage.

The provision is there because homeowners generally take better care of property than landlords, and is thus a better risk and entitled to lower interest rates. Very broadly stated the typical FHA mortgage says you are going to live in the properyt for at least one year but allows a bunch of exceptions.

 

[TerryMathews]

If it was mortgage fraud then I did less fraud than the banking industry did to this country's home owners. We owe them some more fraud. Fuck them greedy bastards.

Problem is, you're not defrauding a bank, you're defrauding Uncle Sam.

 

[NetWareHead]

See 4155.1 4.B.2.b, the part I quoted above. The requirement is to live in your house within 60 days of closing and then continuously for at least one year. After that, you are free to rent.

Yes I beleive that is how I interpreted it as well. There is no outright mention of this, but since you are only required to live in it for a year I interpreted that you are free to rent it out after a year after fulfilling this requirement.

Then you get a refinance when you get enough equity and you instantly drop the required monthly PMI payment. For the property I'm looking at, PMI alone is over $300 a month.

 

[z1ggy]

Yes I beleive that is how I interpreted it as well. There is no outright mention of this, but since you are only required to live in it for a year I interpreted that you are free to rent it out after a year after fulfilling this requirement.

Then you get a refinance when you get enough equity and you instantly drop the required monthly PMI payment. For the property I'm looking at, PMI alone is over $300 a month.

That answers my questions then. Looks like once it's time to rent the house out, I will have to call up the lender (which is Chase). Might also refinance if I think this will turn into a long term rental. I don't live in a populated area so I am not sure how easy it will be to rent it.