Can I get an FHA loan if I already own a home?

Do I have to be a first-time buyer to use FHA?

No. FHA isn't a first-time buyer program. The real rules are that the new home must be your primary residence, and you generally can't have two FHA loans at once.

What if I own a home without an FHA loan?

Then the one-FHA-loan limit doesn't apply. If your current home has a conventional or VA loan, or no loan at all, you can often get an FHA loan on the new home you'll move into, as long as you qualify with both housing payments (unless you sell or rent out the old home).

What are the exceptions for a second FHA loan?

FHA may allow a new FHA loan while you still have one when:

• You're relocating for work to an area too far to commute from your current home.
• Your family has grown and your current home no longer fits, as long as you have enough equity in it.
• You're leaving a home you co-own, for example after a divorce or when a co-borrower keeps the house.
• You co-signed someone else's FHA loan but don't live there.

What about renting out my current home?

You can, but the lender will look closely at the rental income and may only count part of it. If you have enough equity in the home, that rental income is easier to use in qualifying.

Example scenario (illustrative)

A couple in Tampa bought a two-bedroom condo with an FHA loan. Now they have twins and need more space. They have enough equity in the condo, keep it as a rental, and qualify for a new FHA loan on a four-bedroom home under the family-size exception.

Our take

People assume they can't use FHA again, and often they can. Tell me what you own, what you owe, and why you're moving, and I'll tell you quickly whether FHA, conventional, or another option makes the most sense.