Tuesday, February 1, 2011

Can I give out for Rent the first house which I financed through FHA Loan?

Recently, I bought my first house in the U.S through FHA loan. The Bank told me that, since this is my first house and financed through FHA Loan, this should be my primary residence and it cannot be used for commercial purposes. Now that I want to move to another state, can I rent my house to somebody? If so, is this commercial, and will I land up in problem with the Bank or Government? Please someone advise me.


You asked this exact question yesterday and my answer is still the same. If you are found out, and you will be, you will face substantial penalties and will have to refinance, at commercial investment rates, within 30 days after the note is called due because you are out of compliance.

So, NO - you cannot do this.

If you received the $8000 tax credit, then it MUST be your primary residence for at least 3 years (I think it's 3). If you move out and rent it out and the government finds out then you will have to pay that back. Not sure if this is the same for the FHA loan situation though.

No you cannot. The FHA does not guarantee loans to buy income properties.

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