FHA questions for a rehab, hold, & rent? Private money better?

[Griffin Pratt]

I'm looking for some insight regarding the flexibility of FHA loans. I know about the general qualifications for FHA/203k and am thinking this could be a good strategy for a property I am analyzing in St. Petersburg, FL. I plan to purchase the property with FHA and rehab with the 203k. It has been my understanding that FHA loans must be used for homes that are "move-in ready". I'm concerned the extent of rehab it needs will prevent approval by Fannie Mae. Any advice or experience with the flexibility of FHA loans in this context?

Also, I know its required that I live in an FHA financed home for minimum 1yr, so can I live/rent somewhere else while the rehab is being done or does the home have to be my primary residence?

Also looking for references/connections to reputable private money lenders as an alternative if anyone would be interested in working together and wants to connect!

Griffin