Can you use FHA 3.5% DP multiple times??

[Gabriel L.]

Hello BP community,

I'm getting into real estate investing with the buy and hold househacking strategy and planning on going the FHA 203K route.

I know if you're a first time home buyer you can get away with 3.5% down payment when owner occupied. Looking to live there for a year, move out, rent that unit I was in and hope to rinse and repeat.

my question is, is it possible to once again use FHA with the 3.5% DP or would I have to put more down since I would already own a first home?

[Jason Wray]

I understand and you can only have one FHA loan at a time. There are some circumstances where you can have two if the second home is larger in terms of GLA due to an increase in family size. The opposite is also accepted when your older and retiring and need a smaller home. But to continue to use the FHA 203K back to back is going to be a very hard sell to the underwriter. They are trained to look for investors using loop holes to buy more rentals.

FHA allows you to use a second time if your buying a home closer to school, work or again fits one of the above situations. You can also use a Fannie/Freddie homestyle loan that allows for renovations.