I want to commend Ruth on her correct answer. It has been a rule with FHA for a very long time that if you have been residing there that you must've been there for a minimum of 6 months to qualify for FHA funding. I would tell her to continue paying rent for two more months, and she'll be set to go.

Good Luck!

This is not exactly a "new" rule, (it's been around for a long time) but your lender is correct in that it certainly is an FHA rule. FHA requires that if the buyer is residing in the subject property, they must be living there for six months before being eligible for an FHA loan.

It may seem illogical, but that's the law.

Further, you don't provide much info on the "flip" house (when you bought it, how much you paid, what improvements if any you made) but there are also rules governing -- and in many cases prohibiting -- FHA financing of houses that are deemed to be a "flip" In fact, FHA guidelines even use the term "anti-flipping".

In addition, you may or may not have other issues -- for example, Is there a gift of equity? If so, the LTV would drop to 85% etc. Your loan officer would probably have addressed those issues. Actually, your loan officer should have known all this at the time of application, but many lenders who got into the business when it was much easier to do conventional loans and so they do not always know all of the nuances of government lending.


Ruth Bonapace
Bank of America Home Loans
201 741-5269
ruth.bonapace@bankofamerica.com

Jencan,

The only thing I can think of is property flipping concerns or identiy of interest concerns. If you want, i can run the scenario by my underwriter. I do have a couple of questions before i present the scenario to her. You can either call me at 800-793-9633 ext 185 or email me at dcastagna@emmloans.com

I honestly wouldnt want to mislead you, so i would rather just go directly to the underwriter for you. Look forward to hearing from you

Danny Castagna
Sr Loan Officer
E-Mortgage Management
222 Haddon Ave
Haddon Township NJ 08108
800-793-933 ext 185