Timeframe to move in to a house hack on an FHA loan

Timeframe to move in to a house hack on an FHA loan

Keene, NH · Member since 2023 · 2 posts · 3 votes

When house hacking with an FHA loan, is there a certain timeframe that the FHA dictates you to be moved into your property within after making the purchase?

Say I purchase a duplex with an FHA loan and plan to occupy of the units as my primary residence, but I have five months left on my current 12-month lease. In order to avoid breaking my lease early to move into my new duplex right away (and to avoid paying the fees associated with breaking the lease), my idea is to allow the current tenants in my duplex to stay for the next five months and collect their rent for both units, all while continuing to pay my rent for the rest of my lease term. Then once my lease is up, I'd take over one of the units in the duplex.

Basically my question is this: does the FHA require you to use the property as your primary residence right away after purchasing, or could I wait the five months until my current lease is up and am able to move? 

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Rental Property Investor · Bluffdale, UT · Member since 2016 · 18 posts · 8 votes
3y

Per their rules, you need to occupy the place as your personal residence within 60 days of closing on it.

4155.1 4.B.2.b FHA Requirement for Establishing Owner Occupancy

At least one borrower must occupy the property and sign the security
instrument and the mortgage note in order for the property to be considered
owner-occupied.

FHA security instruments require a borrower to establish bona fide occupancy
in a home as the borrower’s principal residence within 60 days of signing the
security instrument, with continued occupancy for at least one year.


https://www.hud.gov/sites/docu...

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  • Rental Property Investor · Bluffdale, UT · Member since 2016 · 18 posts · 8 votes
    3y

    Per their rules, you need to occupy the place as your personal residence within 60 days of closing on it.

    4155.1 4.B.2.b FHA Requirement for Establishing Owner Occupancy

    At least one borrower must occupy the property and sign the security
    instrument and the mortgage note in order for the property to be considered
    owner-occupied.

    FHA security instruments require a borrower to establish bona fide occupancy
    in a home as the borrower’s principal residence within 60 days of signing the
    security instrument, with continued occupancy for at least one year.


    https://www.hud.gov/sites/docu...

  • Dan GuentherBusiness Member
    Real Estate Agent · Longmont, CO · Member since 2019 · 548 posts · 271 votes
    3y

    @Laura Romaniello - 60 days is the norm per FHA guidelines. What would be the penalty for breaking the lease? In that 5 months that you'd be renting you could be halfway to shopping for property #2, paying down your own loan (not someone else's), saving a lot on taxes etc. I'd run the numbers in both situations and make sure your best move is to keep renting.

  • Derek BrickleyBusiness Member
    Lender · Ann Arbor, MI · Member since 2021 · 665 posts · 227 votes
    3y

    FHA would definitely not allow you to wait 5 months before moving in. But maybe you could propose sub-leasing your current place for those 5 months with your current landlord. As long as they approve, that would probably be a good option to not break the lease but also move in as soon as possible.

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