The Federal Housing Administration (FHA) is extending the “anti-flipping” waiver through 2012. The waiver allows home buyers to purchase houses using FHA financing that had been previously sold within the past 90 days.
The intent of the waiver is to speed up the sale of foreclosed homes and help improve the housing market.
The anti-flipping waiver will allow home-buyers who are limited to FHA financing, more options when searching for homes. The extension is also good for investors, allowing them to sell investment properties to FHA buyers without having to wait 3 months.
Restrictions in place to prevent predatory flipping still remain in place and include:
- Sellers must justify any increase in value if the sale price is 20% more than what they recently purchased the property for.
- Sales must be in “arms-length,” In other words there can be no interest between the seller, buyer, or other parties participating in the transaction.
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