looking to buy a home.....but confused on several issues

If you qualify for the mortgage and it is your primary residence, what rooms you rent out are of no concern to anyone. It's not a matter that would affect qualification as long as you are not renting the entire house. Taking on a boarder is not an issue.

Those are very good questions, Patrice. First, let me point out that if you have a sizeable down payment and good credit, FHA may not make as much sense for you as a conventional loan might; look at a couple scenarios. Don't hide the fact that you intend to rent out some rooms, and, as long as you intend to occupy the property yourself you could still be considered an owner occupied loan and receive some of the best rates available. Also, don't expect to use the room rent as a way to qualify for the home. This may disqualify you from certain programs, but not necessarily from a standard FHA or Conventional loan; I have a program here in Utah where no rooms can be rented out, but it is a special program for low and median income borrowers. You may run into what we call lender overlays, though; in which case the lender determines your qualification based on their own guidelines, not necessarily FHA or Conventional general guidelines. For more specific questions, contact me at http://www.homeloansinutah.com/forms/askAnExpert.html.