FHA Loan On Second Home

[topa]

I'd like to thank everyone on these boards for helping us buy our first home - we closed on September 26th and are extremely grateful for all the advise. 

Our first home is a conventional mortgage.  The question is, what are the FHA requirements for a first FHA loan on a second home?

[StartingOver10]

For an FHA loan, the home has to be a primary residence not a secondary home.

[topa]

Is there a possibility of buying a second home without having to foot a 20% down payment? The price will be pretty low - somewhere around $75k.

[StartingOver10]

Depends upon the use: you can get a second home for vacation type use (a true second home) for 10% down (conventional loan, not FHA).

If you are getting a second home but plan to use it as an investment property then you will probably need to put down a minimum of 20% or 25%. Investment properties are handled differently from 'second' homes.

[bigman023]

Ive been looking into a second home as well.  I was shocked when I learned that in certain cases, FHA can be used for 2nd home, sort of.  They're called kiddie condo loans.  These are FHA loans done using FHA's non-occupying borrower guidleines, and require a 3.5% down payment.

Dont let the name throw you off.  The loan does not have to be used for condos nor does it have to be used for kids. It is mostly used to allow parents to become co-borrower with their college kids, so that an FHA loan can be made on a home for the college student. The parents can even have an existing FHA loan on their primary residence and still qualify for a second FHA loan.

This loan works for us, because we have a kid in college, and his school is where we want our second home.  The kid or someone on the loan must occupy the home. But after the 1st year of occupancy, it can then be treated as a vacation home.  We plan to let our son use them home and maybe rent out a room to a freind. Once they graduate in 2 or 3 years we will use it as a vacation home.

If you're in the market for a second home and want a loan with a low down payment, I would definitly google kiddie condo loans.

Good Luck!