General Area in 92649>Question Details

Rlo, Both Buyer and Seller in 92649

Can I rent a FHA financed condo if it was a principal residence for 3 years?

Asked by Rlo, 92649 Fri Oct 3, 2008

My late husband owned a FHA financed condo. After he married he moved to my home and rented his condo. The mortgage company is telling me I have to refinace if I want to rent the condo.

Help the community by answering this question:


Hi Rio,

I am sure you have already solved this issue with your lender. I just wanted to mention after reading your question, that in this market with so many people not paying their mortgage and attempting loan modifications and short sales..that as long as the payments are made every month on time, they probably won't call the loan due. I would consult many lenders to get opinions.
0 votes Thank Flag Link Wed Jan 2, 2013
Lender answer:

According to FHA guidelines, the lender must certify that the buyer will occupy the dwelling within 60 days of closing and continuously occupy for at least 12 months.

If your husband occupied the dwelling for at least a year after closing, he has met and fulfilled FHA's requirements. The lender does not have any rights to dictate whether a mortgagor (home owner) may or may not rent out a home with an FHA insured mortgage after the occupancy requirement has been met. Such a requriement from the lender is not supported anywhere in FHA guidelines and may possibly interfere with "quiet enjoyment" of your fee estate.

FHA permits a borrower to hold more than one FHA mortgage at a time under certain exceptions. An increase in family size, (eg getting married) is one of the exceptions. Relocating closer to work to make a more reasonable commute is another.

You mentioned that your husband has passed. Technically, the mortgage held by him must be paid off even though you have inherited the home since you are not a borrower on the condo loan.

The lender may, at its option, forgo exercising the due-on-sale clause (the home was transferred or "sold" to his estate)... but it sounds like the lender sees an opportunity to earn a fee for refinance and otherwise performing note. You cannot assume the FHA mortgage from your husband's estate unless you certify that you will occupy the condo.

I suggest speaking with a supervisor in the loan servicing department to see if they are willing to keep your late husband's mortgage "open" rather than asking about how you intend to use the property.
0 votes Thank Flag Link Fri Oct 3, 2008
Hello Rio:

There has to be more to this story. Write me at for non-public answers to your questions. Thanks!
0 votes Thank Flag Link Fri Oct 3, 2008
I agree with Lynn. You will need to read (and understand) the loan docs. A Realtor can help you if you do not have copies of your loan docs - Realtors have immediate access to most loan docs that have been filed with the county. Look before you leap into a re-fi.

Best of luck!

Thom Colby
Web Reference:
0 votes Thank Flag Link Fri Oct 3, 2008
Read the lender documents difficult to determine without having all the facts.
Web Reference:
0 votes Thank Flag Link Fri Oct 3, 2008
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