FHA Does Front Flips!
Inman News reports on a very important extension issued by the Federal Housing Administration. According to the article, "For the second year in a row, the Federal Housing Administration is extending a temporary waiver of its "anti-flipping" rule, meaning homeboys relying on FHA-insured financing will continue to be able to buy homes that have changed hands in the last 90 days." Why this is so important is that it flys in the face of the Freddie Mac and Fannie Mae addendum's which prohibit the resale of a short sale within 90 days of purchase. You have competing opinions from 2 government entities!
According to the article, "In February 2010, the Obama administration waived the waiting period for resales -- including homes purchased and rehabbed by private investors -- in the hopes of stabilizing home prices and revitalizing communities hit by foreclosures. It often takes less than 90 days to acquire, rehabilitate and sell properties, the Department of Housing and Urban Development said at the time. Some sellers of rehabbed properties had been reluctant to enter into contracts with FHA buyers because of the cost of holding a property for 90 days, HUD said.
In extending the waiver through 2011, FHA said it insured 21,000 90-day property flip loans worth more than $3.6 billion in 2010 that would otherwise not have qualified for financing.
That number has since grown to nearly 42,000 mortgages worth more than $7 billion on properties resold within 90 days of acquisition.