Extension of FHA “Flipper” Rule Good News For Buyers & Sellers Alike

While the FHA declared its waiver on insuring mortgages on properties owned by the seller for less than 90 days a temporary measure to help the foreclosure-plagued U.S. housing market, it has continually extended this waiver since 2010.  This indicates the strategy has been successful in promoting quick turnovers of such properties from small-time “flippers” who renovate and sell them.  While restrictions are in place to prevent predatory flipping practices, this extension gives many home-buyers more options and the short-term sellers the security of knowing that their properties will not be vacant for longer than the duration of the renovation process.  The waiver has been extended through the year 2013, at which point the FHA will have to reconsider the decision.

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