Zillow Advice: Investing - FHA Suspends 90 day flipping rule. http://www.zillow.com/advice-thread/FHA-Suspends-90-day-flipping-rule/470863/ Zillow Advice | Zillow Real Estate Potentially great news for ... http://www.zillow.com/advice-thread/FHA-Suspends-90-day-flipping-rule/470863/ Potentially great news for Orange County real estate investors, developers, and “flippers†this week as the FHA announced they would continue their suspension of their “90-Day Anti Flipping†rule until the end of 2014 for all FHA insured loans. Explanation of the 90 Day Flip Rule: The “Anti-Flipping Rule†was enacted in 2003 and was aimed at preventing the FHA dubbed “Property Flipping,†where “a property recently acquired is resold for a considerable profit with an artificially inflated value, often as the result of a lender’s collusion with an appraiser.†(Source: FederalRegister.gov) The Anti-Flipping rule affected mortgage borrowers who were using FHA-insured mortgages to get their loan. The Anti-flipping rule simply stated that the FHA will not insure a mortgage if the seller had purchased the investment property within ninety days. FHA-insured loans are one of the most popular loan choices in the lending world- especially for first time home buyers- because of their low down payment (3.5%) and credit requirements. In 2010, the FHA suspended this rule due to the “struggling†economy to move excess inventory of homes off the market and buyers into those homes. HUD believes that it has made a significant contribution to neighborhood stabilization. The Specifics of the Anti-Flip Rule Suspension The suspension of the Anti-Flipping Rule contained several key rules that must still be adhered to in order for the FHA to insure these loans. Here are the rules: There must be no “identity of interest†between the buyer and the seller (also known as being “arm’s length.) In other words, the buyer and the seller cannot have an interest in the deal together. Mon, 10 Dec 2012 07:24:00 GMT http://www.zillow.com/advice-thread/FHA-Suspends-90-day-flipping-rule/470863/ 2012-12-10T07:24:00Z Michael Parker, Corona del ... http://www.zillow.com/advice-thread/FHA-Suspends-90-day-flipping-rule/470863/ Michael Parker, Corona del Mar Real Estate Broker Mon, 10 Dec 2012 07:22:00 GMT http://www.zillow.com/advice-thread/FHA-Suspends-90-day-flipping-rule/470863/ 2012-12-10T07:22:00Z