FHA Owner/ Rental

[Ryan Conklin]

I am looking at getting a 5 bedroom home with a FHA 203k streamline loan. First off, I read somewhere that the FHA loans only support 4 unit homes. Do they count bedrooms as "units"?

My second question is whether or not I can rent out the other 4 bedrooms.  I will be occupying the master but would receive a bunch of income from the other 4 rooms.  I do not want to go through hassle of buying/ rehabbing if I won't get approved for a 5 bedroom or can only rent out 1 more room.

Thanks!

[Penny Clark]

@Ryan Conklin, You can get an FHA loan for 1-4 units ( SFH, duplex, triplex and fourplex ) It sounds as if you are occupying a 5 bedroom SFH and want to cut costs by renting out rooms. That's house hacking only you are doing it with roommates instead of having your tenants live alongside you in their own housing unit. If you go this route, screen your roommate-tenants very carefully. You'll want to have a lease or agreement drawn up by an attorney that deals with this type of rental situation. In Cali, it's called a "lodger's lease." You'll also want to set up some house rules because technically, you are renting out a room and they have access privileges to the common areas like the kitchen, LR, FR, laundry, yard, etc. If you do a search on Bigger Pockets forums, you'll find info about this type of house hacking that is being done successfully or unsuccessfully by others on the website.

My nephew in Arizona recently bought a condo and is having his mortgage paid off by his two  in-house tenants. It seems to be working fine for him!

Good luck in your first investment!