FHA Waives 90 Day Anti Flipping Rule Through December 31, 2011

The U.S. Department of Housing & Urban Development has announced that it has instituted a temporary moratorium on FHA’s 90 day anti-flipping rule. With certain exceptions (such as HUD-owned and bank-owned properties) FHA currently prohibits insuring a mortgage on a home owned by the seller for a period of less than 90 days. 

Under the recently announced moratorium buyers will be eligible to use FHA insured financing to purchase properties boght and resold by developers or investors who own the property for less than 90 days. Under the temporary moratorium, all transactions must be arms-length, may require additional documentation of improvements and justification for the increase in price (over what the investor paid for the property) and may also require a second appraisal and property inspection to be ordered by the lender. 

If you are a real estate investor or contractor this is  a great opportunity to increase your portfolio.