Attention all investors and buyers of "flipped"/rehabed properties - the FHA is lifting their 90-day waiting period requirement on resales. The FHA instituted this waiting period 5 years ago in order to deter fradualent/predatory home flipping.
Lenders are probably still going to have to do some rehab on many of the properties they foreclose on before turning them around to an FHA borrower. FHA has eased up a bit on requirements for minor repairs, but before you can sell a home to a borrower relying on an FHA loan guarantee program, it’s got to be "safe, secure and sound."
Here are some links that go over the requirements further:
Here’s an excerpt from the guidance the FHA gave lenders in a letter back in December 2005:
"Examples of minor property conditions that no longer require automatic repair for existing properties:
- Missing handrails
- Cracked or damaged exit doors that are otherwise operable
- Cracked window glass
- Defective paint surfaces in homes constructed post 1978
- Minor plumbing leaks (such as leaky faucets)"