An FHA home, that is a home financed with a Federal Housing Administration-backed loan, can be rented out under defined circumstance. The information below explains what an FAH home loan is, when it is allowable to rent it out, important exceptions and the reason for the restriction.

Among other mandates, the Federal Housing Administration is tasked with fostering home ownership in the United States. These FHA home loans allow individuals to purchase a home with less down and lower interest rates. Because the FHA guarantees the loans against default, lenders have less risk, so borrowing criteria and interest rates can be lower. Read more