FHA Flip Rule Waived for 1 Year!
This will be music to investor’s ears everywhere! We no longer have to wait and plan to hold for 91 days to contract and sell fix and flip projects to first-time home buyers. This will translate to lower holding costs, more projects, and higher quality inventory for buyers. Some investors may choose to pass along the savings to buyers, many will likely choose to retain better margins on properties in this competitive environment. Thank You FHA and HUD!
90 Day Flip Rule
“Section 203.37a(b)(2) of the FHA regulations, 24 CFR, is hereby:
- Waived for a period of one year,
- Effective February 1, 2010 through January 31, 2011,
- Arm’s length transactions only
- Specific appraisal conditions must be met if property value increases more than 20%
Read the Press Release about the Waiver online at the Official HUD and FHA 90 Day Flip Rule Waiver Announcement
Read the actual Waiver of Requirements 24 CFR 203.37
If you have questions of FHA’s Property Flipping Waiver, please email FHA at: info@fhaoutreach.com or visit: http://www.fhaoutreach.gov/FHAFAQ
4155.2: 4.7
Congratulations investors and real estate investor associations that on the successful grassroots lobbying and information dissemination that helped make this change possible. Let us all continue to work together to rebuild the housing market from the ground up and remodel the housing stock that has been neglected to improve our neighborhoods and communities.
{ 3 comments… read them below or add one }
Is th 90 day waiver going to be renewed past Jan. 31rst.?
Bob – I have not heard yet of an extension. My mortgage broker said he received notification recently to not accept new FHA loan applications on a flip property. This is bad news for investors and buyers as often the best properties are flips by talented investors who can rehab in 30 days. I am currently not accepting offers from FHA buyers on my flips. I am also working flips in a slightly higher price range that is more likely to have conventional loan buyers. I suggest FHA buyers work with knowledgable brokers and agents regarding how and when to make offers on flips. Stay tuned.
My mortgage guy sent me confirmation that it will be extended through Jan 31, 2011. However many lenders will not honor this rule and have seasoning issues of their own. Investors beware when you sign contracts to see your properties and be sure to confirm that your buyer has a loan that will close.
{ 1 trackback }