My head is spinning. I received my 8th email about this waived 90 day flip rule thing. Grrrr....I'm pretty positive I unsubscribed to many of these lenders. I wrote one of my trusted lending professionals and he forwarded the HUD documentation that listed the 90 Day Flip rule waiver conditions. When flipping or working with investors, please talk to a qualified FHA lender who specializes in the intricacies of FHA lending before proceeding forward. Find one who understands the old rules as well as the new rules in order to get a more accurate picture of where the differences lie.
- Do you need an FHA inspection or not?
- Is there a pattern of previous flipping of the subject property? Having multiple title transfers within a small timeframe could possibly draw a red flag.
- Will you need to market the property openly and fairly using public channels such as MLS, auction, For Sale By Owner offerng, etc?
- Are there additional conditions that need to be met for properties that will list for 20% or more over the acquisition price? Can you justify significant increases if asked? Changing carpet, hardware and installing recessed lighting may not necessarily be enough to justify such an increase. If you do not have supporting documentation to substantiate the increase, will the appraiser be able to justify the increase since last title transfer? There of course are many exceptions. Find out what they are.
There are many more conditions that I didn't list. I AM NOT A LENDER. I'm a Realtor® that is constantly being forced to wrap her head around all of the new changes that occur DAILY in our industry and in the industries that affect ours.
Any mortgage professionals who want to elaborate to help us get a clearer understanding of how we can accurately pass on this information to our eager investors and the FHA buyers who we've told "Sorry, we can't look at that home because of the 90-Day flip rule", PLEASE do so... while I pop an aspirin.
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Andi great blog there is a lot of buzz going on the past few days over this new rule I think it will spawn some new sales. I think that 20% thing will get some people.
The more things change the more they stay the same.
Check out Ruth Vogts blogs on Active Rain. She has some wonderful knowledge to share.
If you pay cash or finance you still have to rehab and Find buyer, The 90 day rule never scared me away from investing during this time of great deals, so I dont think you'll see a whole lot more because of this small change, our market is filled with buyers looking for deals ,investors and first time buyers
Mike nehmzow Get You Moved Realty
Heather - I heard some who thought this would get the sideline flippers to act. But I think those who were planning to act were already doing so, at least in our market of multiple offer situations.
Wayne and Lynda - we need a graph for everytime they flip flop.
Thanks Wendi I will!
Judd - yes, I try to read those docs and then line up my questioning for my lender friends. Of course the best teacher is when you are presented the situation in real time.
Mike - I agree. As I mentioned to Heather depending on the market, any saavy investor will act when its hot, not when FHA changes a 90 day rule.
Andi - Thank you for the mention (link) in your blog! I have a blog about this program. You can read it by clicking here