Posted on Tuesday, 19th January 2010 by Anna Kulbinski
In an attempt to help stabilize the real estate market, FHA has waived the 90 day flipping rule “temporarily”. The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner. To protect FHA borrowers against predatory practices of “flipping” where properties are quickly resold at inflated prices to unsuspecting borrowers, this waiver is limited to those sales meeting the following general conditions:
- All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.
- In cases in which the sales price of the property is 20 percent or more above the seller’s acquisition cost, the waiver will only apply if the lender meets specific conditions.
- The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program.
More detailed information including the waiver can be found on HUD’s website.
Tags: 90 Day Flipping Rule, FHA, HUD
Posted in Mortgages, Sellers | Comments (1)
Anna K. Kulbinski
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January 30th, 2010 at 5:36 pm
[...] HUD has waived the 90 day flipping rule for home sellers, this could also be a great time for talented fixer-uppers to take advantage of [...]