FHA to waive 90-day flipping rule for 1 year

his update from FHA was released on Friday January 15th, 2010, as an excerpt from the CFR (Code of Federal Regulations) without a corresponding Mortgagee Letter and contains information about FHA's policies regarding the waiver of the 90-day seasoning required for sellers.

Here are the 6 things you need to know about these changes:

1. Waiver takes effect February 1st, 2010 for a period of one year unless extended.
2. Investors are now exempt from the 90-day seasoning rule.
3. All transactions must be arms-length.
4. No identity of interest can exist between buyer and seller.
5. If sale price is 20% or more of the seller's acquisition cost, the lender must:
   a. provide supporting documentation and/or a second appraisal and
   b. order an inspection of the property and provide it to the buyer.
6. The waiver is limited to forward mortgages only.

As I receive more information from HUD I will be sure to pass it along.  Should you have any questions at this point, please feel free to contact me.

All the best,

Dave

David M. Setti
Branch Manager
DRE #01329941
TurnKey Mortgage Solutions
Phone: 408.377.8876
Cell: 408.605.1848
Fax: 408.273.6356
dave@turnkeyms.com
www.davidsetti.com