Refinancing out of an FHA Loan

[Kevin Reinell]

Hey BP,

I am in the middle of finalizing the financing on a duplex, but due to lack of cash must go the FHA route. The problem is that the PMI on the loan is expensive (about $265 per month) and really kills the cash flow for my deal. The duplex needs a rehab and I had planned on using the BRRRR strategy for this one while I house hack and live in one unit while renting the other out. Both units are currently rented, one tenant is month to month. My question is at what point would I be able to refinance out of the FHA loan into a conventional? Can I do it right after I finish the rehab? Is the there a waiting period for FHA? Anyone who has had experience with this that could chime in would be great.

Appreciate your responses!

[Kevin Reinell]

@Bob Norton thanks for the response, I anticipated what you described. I do plan to live there for one year while doing the rehab, so no problem there. I guess then I just need to ensure that the rehab will raise my equity to 20%+ upon completion, that way I can refi into the traditional mortgage and drop the PMI after the 1 year.