Subject to FHA Loan

[Ariel Cohen]

Today I went to look at a 3 family property in Brooklyn. The seller was previously renting the property as an SRO and is now in the process of removing the last 2 of 17 tenants.

The property has 3 3BR/2BA units and after some mostly cosmetic renovations the property will be able to rent each unit for $2,800/month.

The seller has a $732k FHA loan on the property that was originated in March 2015 and I am looking to purchase the property for $950k subject to the existing FHA loan.

The business plan is to renovate the units, get in tenants, and then refinance the property to pull out the equity invested and then hold for cash flow.

Does anyone have experience buying properties subject to an FHA loan?