Transitioning FHA Loan to Conventional... Requirements?

[Abigail Okenge]

Hello, rookie here!

My husband and I currently live in a single family home outside of the city, but are wanting to rent out the SF and move into a duplex closer to the city/his school (he's a grad student). We are wanting to use an FHA loan to purchase the duplex and then house hack until we have enough cash on hand to do the same thing with another duplex (move out of duplex #1 & rent out both units, then move into duplex #2 using FHA loan to house hack). I haven't spoken to any lenders yet, but am wanting to ensure I have a decent understanding of FHA loans before moving forward...

If we purchase duplex #1 on an FHA loan, does it have to be our primary residence for a required length of time? Or, can we live there for 4-6 mo. before refinancing duplex #1 out to a conventional loan, then using an FHA loan on duplex #2? Hypothetically, can this process be continued indefinitely as long as we live in the property that we use to purchase with an FHA loan?

Any info would be GREATLY appreciated. Thank you! 

[Muhammad Amawi]

Hey I'm a lender,

So if you do go with FHA and try to get another FHA you can the timeframe and distance from existing FHA loan will matter. If you have any change in family size, or anything that would qualify you for the additional home purchase you can do multiple FHA loans.

As far as buying a home on FHA and then refinancing that to a conventional loan you would have to wait 6 months to get the full value of that home. If you are buying a Duplex on FHA you do have to have the intention of living there as your primary residence. If you decide to refinance to a conventional loan you will have to pay cost to do this again, however you can access the equity as a Primary home refinance, cash out.

After you get the first home, and if you decide not to stay there then you will want to make sure that the new purchase for a duplex is eligible for another FHA loans. I know that FHA did have a rule about it being 100 miles from existing home to get another FHA loan. If you end up switching to conventional on a refi then you will not have to worry about this distance. If you want to set up a chat we can walk through a few scenarios.