FHA 90 Day Seasoning Waiver Expanded - Flip Flip Hooray!?!

By
Real Estate Agent with Keller Williams Realty 04101860

 

90-Day Seasoning Waiver Expanded

This 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 me 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.

To read the text of this waiver and specific details: http://www.hud.gov/offices/hsg/sfh/waivpropflip2010.pdf

Be sure to bookmark my blog so you can track back later this week and read my thoughts on this topic!

Comments (3)

Dawn Workman
Veracity Real Estate Group, LLC - Camas, WA
Camas Real Estate Expert, MBA, 480-540-8100

I think this is great news and I couldn't be happier!  :)

Jan 20, 2010 03:39 AM
Jana Reyes
Keller Williams Realty - Elk Grove, CA

Hi Dawn,

Thank you for the post!  Everyone in the office is excited. There is a buzz in the air.

Jan 20, 2010 04:35 AM
FRANK LL0SA Esq.- Northern Virginia Broker .:. FranklyRealty.com
Northern Virginia Homes - FRANKLY REAL ESTATE Inc - Arlington, VA

What is really unclear to me is how they calculate the "sold for more than 20% of cost" Are they referring to profit? What if you bought for $100k, and are selling for $125k and there is $6,000 in commissions. Is that over 20%? Frank

Feb 13, 2010 02:32 AM