FHA Property Flipping Waiver
Last week, FHA made changes to its property flipping guidelines. The changes have seemed to cause a bit of confusion and I wanted to clarify the message which was sent out.
FHA has held a 90 day property flipping guideline for sometime now. In June of 2008, FHA issued a 1 year exemption to the property flipping rule on foreclosed properties. The change made last week was only to extend the exemption for another year and add a new exemption for foreclosed properties that have been purchased by state or local governments using funds granted to them through the Neighborhood Stabilization Program (NSP). I have attached the verbiage which was sent out in 2008 as well as the verbiage from last week should you like to read the exact details.
As I mentioned above, FHA has been steadfast on their 90 day property flipping rule for many years. However, they do have certain exceptions to this guideline which are noted below:
- Sales by HUD under its Real Estate Owned
- Sales by other US Government agencies of single family properties pursuant to programs operated by these agencies
- Sales of 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 through inheritance
- Sales of properties purchased by employers or relocation agencies in connection with relocations of employees
- Sales of properties by state and federally charted financial institutions and Government Sponsored Enterprises
- Sales of properties by local and state government agencies
- Sales of properties within Presidentially declared Disaster Areas
