Can i rent out a PORTION of my house if i have an FHA loan on it? I would still be occupying it myself, but the renter would rent the basement from me

Asked by Anthony, Minneapolis, MN Wed May 4, 2011

FHA loan - Partial Renter

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Roger2171, Home Buyer, New York, NY
Wed Sep 4, 2013
Go on if you alredy own the house... Just be carfull with the town regulations...
FHA dont prohibit to rent basements, you can't use that income to qualify for an FHA loan,....
0 votes
Peter Boyle, , Minneapolis, MN
Wed May 4, 2011
FHA does not prohibit you from bringing in “border rent” income. They wont count it in qualifying unless it is a family member who can prove they have rented from you for the last 12 months, but if you don’t need the income to qualify you don’t have to worry about it.

Peter Boyle 612 701 6816
0 votes
Mary Jo Quay, Agent, Burnsville, MN
Wed May 4, 2011
Lenders are mostly interested in that you keep up with mortgage payments. There are lots of families that look for homes with a mother-in-law apartment to rent out to friends or family. If you are buying, you can only use rental income if there is history of rent at a property, which is almost always duplexes and multifamily.

In this economy, more and more people are sharing costs and 'overhead.' As long as your renter keeps in line with the culture of the neighborhood and isn't a nuisance, it shouldn't be a problem. Minneapolis codes require a legal egress window in case of fire. If there isn't one, you can usually enlarge an existing window without too much difficulty.
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..., , Lexington, MA
Wed May 4, 2011
I agree with Joey but if you want to be safe, check your local zoning laws to make sure that there would be no violation in using basement space as living quarters.

Some programs do allow rental income from boarders but FHA, FannieMae and FreddieMac do not consider rental income from the unit you are living in, so rent is never allowed to be added to income with those programs in the case of a single family home - only in 2, 3 and 4 family homes - and then only with 2 years of rental income history.
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Joey Torkild…, , Minneapolis, MN
Wed May 4, 2011
Hey Anthony- There shouldn't be any problem with renting out the basement with your FHA loan. You just won't be able to include the rental income for qualifying purposes since it is not a legal separate living unit.

Hope that helped!

Joey Torkildson
Edina Realty
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