Since 2010, The Federal Housing Administration (FHA) has had in place a WAIVER of its rule prohibiting the use of FHA financing to purchase a property that was being sold within 90 days of its previous acquisition. This waiver allowed investors who had purchased a home with the intent of remodeling it and reselling it within a short period of time to sell the home to a buyer who was using an FHA loan program to purchase the home. Although there were some restrictions on that program, such as mandatory second appraisals, it allowed many buyers to purchase these properties with a low 3.5% down payment under FHA guidelines.
Each year since 2010, the waiver has been extended annually. FHA announced the rule would expire on December 31, 2014, at 11:59 PM. In order to qualify under the existing waiver, contracts must be fully executed prior to that date/time.
Exceptions to the FHA Anti-Flipping Rule
There will continue to be exceptions allowed for the following entities:
- Sales by HUD (Department of Housing and Urban Development) of properties owned by them (REO).
- Sales by other federal agencies of REO properties.
- Sales of properties by nonprofit organizations that have been approved to purchase and resell HUD REO properties.
Sales by state and federally-chartered financial institutions and government-sponsored enterprises (GSEs), such as Fannie Mae and Freddie Mac.
Upon the announcement by HUD through the issuance of a notice, sales of properties in areas designated by the President as federal disaster areas.
Related: Property Flips: Do you need to wait to buy or sell a property that was recently purchased?
Marimark Mortgage
Marimark Mortgage is based in Tampa, Florida and serves the mortgage needs of homebuyers, homeowners, and investors in Florida, Virginia, and Pennsylvania.
We specialize in conventional home mortgages, FHA, VA, and USDA mortgage options, refinance loans, and reverse mortgages. We’ve worked extensively with cash-out refinancing and help clients to lower their monthly mortgage payments.
To get started with a mortgage to buy your next home, please fill out our Quick Mortgage Application, or contact us direct.

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