Industry NewsMortgage

FHA lifts 90-day waiting period

Anti-property-flipping measure waived for one year
Published on Jan 18, 2010

Starting Feb. 1, housing regulators will suspend for one year a 90-day waiting period on property resales that it says has put FHA borrowers at a disadvantage in bidding on foreclosed properties.The waiting period on FHA financing of resales was implemented in 2003 to protect the Federal Housing Administration's mortgage insurance program from the impacts of home flipping.The policy did not apply to properties repossessed by Fannie Mae, Freddie Mac, or state- and federally chartered financial institutions. In 2008, FHA lifted the 90-day waiting period on resales of all bank-owned (REO) properties (see story).Now, although many other conditions still apply, the waiting period is being lifted on all resales -- including properties purchased and rehabbed by private investors.Research shows that acquiring, rehabilitating and reselling properties to prospective homeowners often takes less than 90 days, the Department of Housing and Urban Development (HUD) said in announcing the change.Some ...

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