FHA 90 Day Flip Rule Is Waived for 1 Year

Good news for investors in Tucson Real Estate!

Effective February 1st 2010, FHA/ HUD will not require that a seller of a property be on title for 90 days or more in order to sell the property to a borrower acquiring FHA financing. This is an incredible opportunity for the majority of buyers & sellers in today’s market.

This news is an important decision handed down by HUD as it proposed to dramatically assist the real estate market recovery.

Prior to HUD’s decision, HUD required that a seller had to hold onto the title of the property for a period of 90 days after settlement date. This has always affected an investor’s decision in accepting an offer made on the investment property by a FHA Approved Buyer. This will all change on February 1st for a temporary period of 1 year.

Below is an excerpt from the HUD website:

“In today’s market, FHA research finds that acquiring, rehabilitating and the reselling these properties to prospective homeowners often takes less than 90 days. Prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition adversely impacts the willingness of sellers to allow contracts from potential FHA buyers because they must consider holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time.

The policy change will permit buyers to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales. This will allow homes to resell as quickly as possible, helping to stabilize real estate prices and to revitalize neighborhoods and communities.”

This great news obviously comes with some restrictions. However, they are minimal but important when looking at the new rule. REMEMBER, THIS IS FOR ONE (1) YEAR ONLY!!

The New FHA 90 Day Flip Rules

The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner.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.

Top Ten Place to Live!

How about this!!!

Tucson was on the list of the Top 10 cities to find the best home! Check out the link below to the video from the Today Show on NBC.

By the way, it's been in the 70's all this week! January!! What a place to live!

The Today Show