FHA just hit a “3-run home run” in my opinion, by extending the suspension of the “anti-flipping” rule for another year on Monday. What this means, is – FHA (‘aka’ the government) is now interested in not only helping low down payment borrowers, but also investors who “fix up” foreclosures and REO homes, and local communities burdened by foreclosures and bank-owned homes.
For years, FHA would not insure a mortgage on a house whose seller had owned it less than 90 days. But with the rising levels of REO properties and foreclosures, in 2010, HUD was forced to make some revisions to the anti-flip policy enacted in June 2006. On Monday, such revisions were extended for another year. I explain briefly…
This is great news for investors and real estate agents. Private investors will now be more likely to bid on these homes, fix them up, and sell them to buyers who can benefits from FHA Financing, a low down payment option for home buyers (3.5% down). Likewise, real estate agents will benefit as many REO or foreclosure homes that are listed and marketed “as is” without warranty and needing repairs. This extension will allow consumers to use the FHA 203k “Rehab” Mortgage Program, a special financing program that allows the borrower to make repairs and upgrades to a house without paying for the repairs out of pocket. I would recommend taking a quick look at the Anti-Flipping Guidelines that I have attached for your review – HUD Anti-Flipping Guidelines
As a result, homes stay vacant less, and buyers have more options! This is a BIG win for our industry, homebuyers, and our communities. Hats off to you HUD!
As a Seattle FHA 203k Rehab mortgage lender, I take a lot of pride in educating homebuyers on the variety of HUD loan programs available. Feel free to message me below or call me at (425) 350-7136 if you would like to discuss the 3 loan programs that I addressed in the video.