FHA flipping rule – 90-day flip waiver eliminated

Bought a house and want to flip it?

The temporary waiver of FHA’s regulation that prohibits the use of new FHA financing to purchase single family properties that are being resold within 90 days of the previous acquisition expired on December 31, 2014.

What this means is that NO FHA lender can accept any purchase agreement dated less than 90-days from the last RECORDED title transfers,

UNLESS:

  • Properties acquired by an employer or relocation agency in connection with the relocation of an employee;
  • Re-sales by HUD itself under its Real Estate Owned (REO) program;
  • Sales by other United States Government agencies of single family properties pursuant to programs operated by these agencies;
  • Sales or properties by nonprofits approved to purchase HUD-owned single family properties at a discount with resale restrictions;
  • Sales of properties that are acquired by the seller by inheritance;
  • Sales of properties by state and federally-chartered financial institutions and government sponsored enterprises (Fannie Mae, Freddie Mac is the owner)
  • Sales of properties by local and state government agencies; and
  • Sales of properties within Presidentially Declared Disaster Areas.

So if you bought a home, fixed it up, and now want to sell it, understand that NO FHA buyer is able to enter into a purchase agreement until YOU have owned the house for at least 90-days.

They can not even sign a purchase agreement until day 91 of YOUR ownership.This isn’t a big deal in many cases, as it take a good 3-months to turn around many fixer-uppers, but just be aware of the rule.


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