FHA has several exceptions to the "one loan at a time" rule. If you meet one or more of the exceptions below, you could purchase a new primary residence with an FHA insured mortgage while retaining the existing FHA insured loan on your current primary residence.
INCREASE IN FAMILY SIZE: If your family has grown (ie new children) and you need a larger home, you may keep your existing residence as a rental property without refinancing the existing FHA mortage to a non-FHA insured mortgage and qualify for a second FHA insured mortgage for a new, larger primary residence. NOTE: Depending on the amount of equity in your current home, you may be required to show enough income to carry both mortgages without the offsetting rental income from your old residence.
NON-OCCUPANT CO-BORROWER: If you co-signed an FHA insured mortgage as a non-occupying co-borrower (eg parent co-signed for child's primary residence to meet qualifying income requirements for child), you may qualify for an FHA insured mortgage for your own primary residence without being required to refinance your child's FHA insured mortgage.
RELOCATION: If you are being relocated, you may qualify for a new FHA Insured mortgage to purchase a primary residence because of employer mandated relocation (or because you decide to relocate yourself) without having to refinance or pay off your existing FHA insured mortgage. Again, you may be required to show sufficeint income for both mortgages regardless of rental income from your old residence if you don't have sufficeint equity in the old residence.
COMMUTE: If you decide to purchase a new residence closer to your existing employer to lessen your commute time, you may qualfy for a new FHA insured mortgage without having to pay off or refinance your existing FHA insured mortgage. Rules for sufficeint income to carry both FHA insured mortgages apply as above. FHA does not set a minimum distance to move under the COMMUTE exception, but the underwriter must determine that a benefit to reducing your commute exists. You probably would be required to show the new and old commute times (and the UW will verify by using Mapquest), mileage savings, and gas savings. Because of the UW's authority to agree or diasagree with your definition of a shorter commute time, this exception may require some shopping around among lenders.
Over the years I've closed loans for all of the above exceptions. It's tougher today than prior years (the shortest COMMUTE exception was just 15 miles... but in Jacksonville, Florida, there is a HUGE difference in commute times from one side of the St. Johns River to the other). Family Size and Non-occupying co-borrower are easy.
You best bet is to talk with a loan originator who works for a lender that funds a large number of FHA insured mortagages. You more likely to be handled by an FHA DE Underwriter. FHA DE underwriters have broad authority (not to mention expertise and certification) in underwriting FHA insured mortgages and granting the appropriate exceptions.
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Fannie Mae guidelines have changed significantly from years past so I would recommend that you speak with a lender prior to leasing your townhome. The guidelines have changed and your existing mortgage will count against your debt to income even if the townhome is rented. Secondly, you will need reserves for both properties. Last but not least, your townhome is now required to have 20% equity. Are there exceptions to the rule? Absolutely, which is why I strongly recommend that you speak with a qualified lender to assess your personal situation. I recommend Wells Fargo which is a nationwide lender. Please feel free to contact one of my favorites, Kathy Terry.
Home Mortgage Consultant
Wells Fargo Home Mortgage
Remember I can do loans in all 50 states!
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Keller Williams Realty Atlanta Partners
You can only have 1 FHA loan at a time. You can refinance into a conventional loan out of your current FHA loan. And then you will eligible for a new 3.5% down FHA loan on the new house you buy. Or you can go with a conventional loan on the new house. There are programs with 5% down conventional.