2016 FHA Guidelines On Buying House Flips
What Are The 2016 FHA Guidelines On Buying House Flips
2016 FHA Guidelines On Buying House Flips mandate a minimum of a 90 day waiting period for a property seller to be able to sell a home to a home buyer who can only buy it with a FHA Loan. Property flipping was extremely popular prior to the 2008 Great Recession and Real Estate Market Crash and has almost come to an abrupt halt. However, house flipping is now back in full force and many real investors are purchasing homes such as foreclosures, rehabbing them, and flipping them for a profit. Many property flippers have large construction crews and can normally get a home rehabbed in less than 30 days after the date of their home purchase, however, they are not able to sell the rehabbed home to a FHA home buyer because under 2016 FHA Guidelines On Buying House Flips, the FHA home buyer cannot purchase a flip unless the house flip has been seasoned for at least 90 days. This is one of the dumbest rules ever implemented and definitely hurts home buyers, home sellers, and the economy. Nothing is wrong with a real estate investor purchasing a home that is in need of work and rehabbing it and reselling it for a profit. There are real estate investors out there who can turn around a complete gut rehab in less than 30 days on a single family home. Some rehabbed homes are better than brand new construction homes but due to FHA Guidelines On Buying House Flips, FHA home buyers who are only approved for FHA Loans cannot purchase a house flip that the home seller has less than 90 days seasoning on it.
FHA Guidelines On Buying House Flips: Real Estate Investors
2016 FHA Guidelines On Buying House Flips are extreme setbacks and inconveniences for real estate investors due to the fact that this rule puts a limit on the pool of home buyers for their rehabbed homes. 2016 FHA Guidelines On Buying House Flips definitely impacts not just the real estate investors but also home buyers who fall in love with a totally rehabbed home but cannot purchase it because the home is a flip and has been seasoned less than 90 days. The 90 day waiting period does not apply to Fannie Mae and Freddie Mac which means that conventional loans do not have any 90 day waiting period. Real Estate Investors who need to flip their homes in less than 90 days can only sell it to a home buyer who is approved for conventional financing and not FHA financing.
FHA Guidelines On Buying House Flips of the 90 day waiting period starts from the date the property seller has purchased the home. Most home purchase closings average 45 days and if the real estate investor purchased a property and took about 45 days to rehab it and if they were to have it under contract after 45 days, it will take another 45 days to close so the 90 days would be up, right? Wrong!!! FHA Guidelines On Buying House Flips 90 day waiting period rule starts from the date the property owner has purchased the home and the date of the executed contract and not to wait 90 days to close from the time the real estate investor closed on their home purchase.
Why this rule was implemented has many confused and the FHA Guidelines On Buying House Flips do not make any sense whatsoever. Unfortunately, these are the rules and until the FHA Guidelines On Buying House Flips changes, it is here to stay for the time being. We will keep our viewers updated of any changes that HUD will make with regards to FHA Guidelines On Buying House Flips in future blogs.