Having More Than One FHA Loan

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Typically FHA allows 1 FHA loan at a time.  However that rule is not the end all be all.   In fact, FHA allows borrowers more than 1 FHA loan in certain cases.

More Than 1 FHA Loan Allowed

While FHA rules state a borrower may have just 1 FHA loan at a time, there are 4 scenarios under which FHA will grant an exception to that rule allowing multiple FHA loans.  The 4 exceptional scenarios are:

  1. Re-locations – Borrowers relocating to an area not within reasonable commuting distance from their current FHA financed home
  2. Increase in family size – When the number of legal dependents increase and the current FHA financed is no longer suitable for the families larger size
  3. Vacating a jointly owned property – When a borrower leaves a FHA financed home they co-own with another borrower
  4. Non-Occupying Co-Borrower – A borrower may act as a non occupying co-borrower on someone else’s FHA loan even if they themselves already have an FHA loan.

Most importantly, each of these exemptions is evaluated on a case by case basis by an FHA underwriter.  Additional conditions typically apply.

More information is always available on HUD/FHA’s official webiste

By Jeremy House

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