2 years ago, the FHA waived the requirement that all property flips be seasoned more than 90 days in order to be eligible for FHA financing. The waiver was scheduled to expire December 31, 2011, but has been extended until the end of 2012.
Note that the Waiver continues to be limited to sales meeting the following conditions:
- All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.
- In cases in which the sales price of the property is 20 percent or more above the seller’s acquisition cost, the Waiver will only apply if the lender meets specific conditions and documents the justification for the increase in value.
- The Waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program.
For more information, see the FLTA bulletin