Working with Investors who FLIP? No sale for 90 days!!

Real Estate Agent with Long & Foster Real Estate, Inc. 608255

Did you know that there is a Anti-flipping law?  What does that mean? It means if you purchase a property as an investor and you want to flip it you have to wait 90 days BEFORE YOU can accept a contract for the property. It's across the board, conventional, FHA, and VA....

So be prepared to hold the property for 90 days... FYI

Here is some info. on the FHA regulation...

Below you will see my email from FHA in response to my phone inquiry.  In the response, you'll see that they cite Handbook 4155.2.  A search of HUD's website led me to the 466-page handbook. In Chapter 4, page 25 (4-25), the anti-flipping regulation is laid out.  A specific answer to the question as to when the 90 days begins can be found at 4155.2 4.7.e, which is on the bottom of Chapter 4, page 26 (4-26)  It is very clear that the 90 day clock begins ticking on the "Seller's date of acquisition as the date of settlement on the seller's purchase of that property, and re-sale date as the date of execution of the sales contract by a buyer intending to finance the property with an FHA-insured loan."

Below is a link to the handbook.  I've also attached a copy of the relevant page.  FHA instructed me to have your UW call them if there is any uncertainty remaining.

Passing along the information I get to my clients and YOU.....



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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Charles Stallions 09/29/2009 12:50 PM
District of Columbia District of Columbia County Washington Capitol Hill
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Erik Hitzelberger
RE/MAX Alliance - Louisville REALTOR-Luxury Homes - Louisville, KY
Louisville - Middletown Real Estate

Coni - This has been an FHA regulation for several years.  However, as recently as last year, you could sell conventionally without having to wait.  Do you know when this changed?  Is it for all lenders?

Sep 15, 2009 03:35 PM #1
Coni Otto
Long & Foster Real Estate, Inc. - Burtonsville, MD
CRS Selling in DC/MD

I just found out about it because an investor I work with was completely rehabbed a home and we got a contract a month before his 90 days.. We checked with a title attorney and a lender and was informed that it across the board for any loan. There is a way around it with lots of paperwork and documentation but from what we were told most lenders don't want to deal with it and they will make you wait.

Check with the lender you work with most and repost, would like to know what you find out in your area.. This is what we found out in the DC area...


Sep 15, 2009 03:54 PM #2
Donne Knudsen
Los Angeles & Ventura Counties in CA - Simi Valley, CA
CalState Realty Services

Coni - As you mentioned, there are some exceptions to the rule for example if the property was purchased by Fannie or Freddie the 90 day rule can be waived. 

Sep 15, 2009 04:19 PM #3
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Coni Otto

CRS Selling in DC/MD
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