I am finding a lot of confusion and different interpretations when it comes to flipping homes using HUD/FHA loans. The last time I heard and read on the Federal Registrar website, was that HUD still has a waiver in place until the end of December 2014 that is applicable to all single family properties being resold after the 90-day holding period after acquisition.

There are some stipulations that are still in place even with the flipping rule waiver.

• The property was openly marketed and was available for any type of buyer.
• The property was not repeatedly flipped over the last 12 months
• The transition needs to be an arms-lengths transition.

When a property is marketed for more than 20% of the current sellers purchase price there will be additional stipulations before the property can close with an FHA loan.

• Property will need a second appraisal and the buyer is not allowed to pay for the additional appraisal. It has to be paid for by the investor.
• Investor has to justify and prove the value of the increase in pricing by the additional appraisal and supporting documents.
• An FHA approved inspector has to inspect the property and any needed repairs or updates need to be completed prior to closing by the investor and those repairs have to satisfy the FHA inspector.

From what I can see on my end, you still can flip a property within the 90 day period and have a FHA buyer. Just when the property is priced 20% above your original purchase price you have to jump though some extra hoops to get the property approved for the FHA.

Attached is the FHA flipping waiver ruling for your review.

When you have any questions about this or any additional Real Estate questions, feel free to contact the Settles Team.