Bypassing FHA 1-year owner-occupied requirement

[Shaye Mora]

I'm looking for tips on how to bypass the minimum 1-year requirement on an FHA Loan.

I am currently house hacking a duplex I bought in March 2019 and just recently bought a SFH on June 1st. The duplex is under an FHA loan, which requires me to live there for a minimum of one year extending out to March 2020. The SFH has a 2-car garage for storage and a fenced in backyard for my dog. By moving into the SFH, I'll be generating more income when I get a tenant in the other side of the duplex when I move out.

My question for biggerpockets is, how can I bypass the FHA 1-year requirement? How/when do they even look into this requirement? Is it the utility bill? The mailing address?

Thanks in advance, BP!

[Ray Harrell]

Formal Answer: You should not try to get around the requirement. That requirement is there to prevent investors from buying investment property using low-cost FHA loans. These loans were designed to provide primary housing to first time home buyers.

Practical Answer: Nobody will ever check to see if you moved into the property. In fact, your loan will likely be sold within months of closing, and the new loan servicer only cares that you make the payment. HOWEVER, if for some reason they do find out, they have the option to call the loan (demand the balance in full). Truth is, by the time they send someone to investigate, prove it, take you to court, the year has passed, and you are now in compliance.