Job Relocation: FL to AZ - want to purchase in AZ: current FHA loan Bank of America $50k underwater.

[djJasonSmith]

This has all come up quite quickly, and I'm looking for advice. I am posting this in the Short Sale forum, but in the FHA forum as well (unless otherwise told). I am new to the forum, and new to this entire process. I am looking for guidance.

I have an offer within my company to move to Phoenix, AZ. I have minimal savings outside of a 401k and retirement program, and have the following loans:

$160,000 balance FHA Loan - Bank of America (Original loan 172,000)
multiple student loans in repayment, car loan, and typical monthly fees (insurance, utilities).

Current value appx $110,000 - $120,000. I have never missed a payment or been late in the 4 years i've owned the property. I'm moving to Arizona. I know there isnt enough equity to consider renting as income towards a 2nd FHA loan based on my research. I'd prefer to buy a place in AZ around the $120k mark. I only would have enough cash on hand to make a down payment on an FHA (3.5%) mortgage.

There has to be people in the same position as me. Should I call a real estate lawyer? Short Sale Realtor (remember, I'm not behind on any payments)? Rent it out, and take the few hundred dollar loss per month? While renting in AZ? Can I qualify for an FHA while the other house is for sale?

ANY help would be appreciated.

[Cat Damiano]

Hi Jason,


Sorry about the spammer infiltrating your thread, it happens from time to time unfortunately.

Here are options with FHA loans, in many cases you would have to be in default to get the help with either a short sale or deed in lieu. A job transfer in most cases does qualify for a hardship, but if you are thinking of purchasing using an FHA loan you would not be able to be in default, so it is a catch 22.

FHA National Servicing Center Loss Mitigation Services - HUD

[djJasonSmith]

Cat, thank you for taking the time to read over my post and reply. I have decided to go with renting/leasing out my townhome in FL, while living in an apartment the first year in Phoenix. After I learn the area's, and see what its like, I may look to get a 2nd FHA, with Relocation being the reason. Again, thank you for the advice, thank you for your time, and have an awesome week.

J

[Cat Damiano]

Hi Jason,


That is a good plan to scope out the new area first before committing to buy. And according to the guidelines for a second FHA loan, you should be good to go with the relocation.


Here are the reasons and the exceptions that may allow someone to have 2 concurrent FHA Loans.

• Increase in family size – There must be an increase in family size in which their current house can’t support the new family member(s). You will have to prove the increase. Also, you must have 25 percent equity in your current home or pay it down to 75% LTV (loan-to-value). An FHA approved appraiser must be used to determine such new value.
• Relocation – If the borrower is relocating and it is established that they aren’t in reasonable distance from their current property. Keeping in mind that reasonable can be defined differently from any lender.

Note – If that borrower(s) returns back to the same area, they are not required to re-establish residency in that property in order to have another FHA insured mortgage.

• Vacating a jointly owned property – A borrower my leave a property and be eligible for another FHA loan if the co-borrower is to stay in the same property that is being vacated.

A good example of this is because of a divorce and that the vacating spouse needs to buy a new home.

• Non-Occupying co-borrower – If someone previously co-signed for a family member or relative while using a FHA loan. This type of FHA loan is called a non-occupant co-borrower loan. This borrower would still be eligible to purchase their own home using a FHA mortgage.

Without meeting any of these requirements, a potential borrower would not be approved for a second FHA insured loan.

Good Luck to you!! You have a great week as well.