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The FHA mortgage program (including reverse mortgages, refinance loans, One-Time Close construction mortgages, and FHA rehab loans) does not refuse a potential borrower simply because they have borrowed before, have had a mortgage in the past, or already own property.

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November 13, 2019
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FHA.com is a privately owned website, is not a government agency, and does not make loans.

FHA Loan Articles

News and Updates for Homeowners

I'm Not a First-Time Homebuyer. Is the FHA Program for Me?

 I'm Not a First-Time Homebuyer. Is the FHA Program for Me?
May 2, 2019 - FHA home loan rules can seem complex at first, but a little information goes a long way when you’re trying to decide what the best mortgage loan for you might be. One common misconception about FHA home loans involves whether the borrower is eligible for an FHA mortgage if she is not a first-time home buyer.

It can be easy to confuse the rules and regulations of one government-backed home loan program with another; some people assume that like USDA mortgage loans that FHA mortgages are need-based or aimed at a specific segment of society.

But the truth of the FHA loan program is quite different.

FHA mortgage loans are not specifically designed for first-time home buyers and the FHA mortgage program (including reverse mortgages, refinance loans, One-Time Close construction mortgages, and FHA rehab loans) does not refuse a potential borrower simply because they have borrowed before, have had a mortgage in the past, or already own property.

FHA Mortgages permit borrowers who already own property, and there is no change in basic FHA mortgage loan qualifying requirements or down payment amounts for those who have owned property before.

The FICO score requirements, down payment, and rules for closing costs are the same whether you have owned a home before or not. There are no income caps, no minimum income amounts required, and loan approval will depend on FICO scores and the borrower’s ability to afford the mortgage among other factors.

What first-time home buyers need to know about FHA mortgages is basically that there is a low, but mandatory down payment which is separate from closing cost requirements and other expenses.

First time borrowers need to know that FHA loan rules permit co-borrowers, and even non-occupying co-borrowers. FHA mortgages are for anyone of legal age to enter into a binding legal contract, assuming they financially qualify.

What first-time borrowers and current home owners really need to know about FHA mortgage loans is that there is an occupancy requirement. If you already own a home and want to purchase a new one with an FHA mortgage, you will be required to occupy the home purchased with the FHA mortgage as your primary residence.

FHA mortgage loans are not for those who do not intend to occupy the property after the loan closes. Non-occupying co-borrowers are permitted, but at least one person obligated on the mortgage must agree in writing to live on the property as the home address.

Ask a participating lender about these rules and how they affect your loan transaction.

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