FHA announced new guidelines for those who are going to rent their residence – and then apply for a FHA loan. The “old” rule has always been that if you were relocating, you could “hold” more than 1 FHA loan… otherwise, you could only have one FHA loan at a time.
Now, FHA says that if you have a HOME LOAN, and you are renting that property, the income from the home is not allowable unless the following is met:
“Underwriters will no longer be permitted to include rental income from a primary residence being vacated in favor of another principal residence unless one of the following applies:
· the homebuyer is relocating with a new employer, or being transferred by the current employer to an area that is not within a reasonable commuting distance, OR
· the homebuyer has a 75% LTV or less, as determined by a current (no more than six months old) residential appraisal (may be exterior-only) on the current primary residence.”
If you are considering a purchase, and are interested in FHA financing, please call us early in the process so that we can identify any prospective issues!