FHA Extends Flip Waiver

Posted by ColoradoHomesIQ Real Estate on Thursday, December 29th, 2011 at 12:00pm.

Last week FHA extended the waiver to their 90 day house flip rule through December 31, 2012. FHA guidelines don’t allow a buyer to purchase home when the owner of record has changed within 90 days of the purchase contract. However, they have waived this rule for the last few years in hopes of helping the struggling real estate market.

If you are purchasing a home and obtaining a FHA loan you still need to proceed with caution when purchasing a house that has been flipped. When the buyer’s purchase price exceeds 20% of the price the seller paid for the house there are additional guidelines that must be met. Lenders will require two appraisals to be performed, a property inspection, and evidence of repairs performed on the house to justify the increase in price. Typically, these additional questions are just another hoop to jump through, but they can cause problems (especially the inspection).

Read More About FHA Mortgages in Colorado