FHA Property Flipping Changes

A property will be eligible for FHA financing if the seller is owner-of-record 90 days or fewer if ALL of the following requirements are met:

1. The sales price of the property cannot exceed 20% of the amount the seller paid for the property (acquisition costs)

2. The contract of sale for the purchase of the property is fully executed and fated between Feb 1, 2010 and Feb 1, 2011.

3. The transaction is arms length, with no interest between the buyer and seller or other parties participating in the sales transaction.

4.  LLC's, Corps or trusts serving as sellers were established and are operated in accordance with applicable state and federal laws.

5. There is no pattern of pervious flipping activity for the subject property, as evidenced by multiple title transfers within 12 months.

6. The property was openly and fairly marketed.

7. The appraiser must complete three requirements

    *Comment on any improvements to the subject property made by the seller supported with photos

    *Acknowledge the increase in sales price from the previous sale and provide specific commentary on support for an increase in value

    *Provide listing and sales history of the subject property.

8. The executed purchase contract can NOT be re-dated.

9. The buyer's real estate agent can NOT be the seller. The buyer's real estate agent can NOT be employed by, related to or affiliated with the seller.

10. The Underwriter may require a second appraisal if necessary.

 

I have been calling around trying to find these answers so I hope this help all of you who were wondering too.  I have a listing that is a remodel and some folks wanted to write on it that were FHA approved so here are the answers I was seeking.

 

Clason Whitney Pricipal Broker Remax Platinum

 

2 Comments on FHA PROPERTY FLIPPING CHANGES

FEB
17
2010
322,063 Points 28 Featured Posts Outside Blog Attended Rain Camp

this will certainly help get some of the bank owned homes on the market a little faster and help the investor turn a property
1:05am • #1
Outside Blog

It definitely help no doubts about it.  Thanks for the comment. =)
7:38am • #2


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Clason Whitney

Medford, OR

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Coldwell Banker Pro West Real Estate

Address: 502 W. Main Street #101, Medford, OR, 97501

Office Phone: (541) 773-6868

Cell Phone: (541) 840-6573

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