House Flipping Guidelines

HOUSE FLIPPING GUIDELINES FHA Loans VA Loans • A property is eligible if resold between 91 and 180 days • No Rules for Property Flipping (Additional underwriting after purchase and guidelines may apply at lender’s discretion) § new contract must be dated at least 91 days from current owner/seller aquistion date USDA Loans § a 2nd appraisal is obtained if the resale price is 100% or • If a property’s value increases substantially between the greater than price paid by seller previous sale and new purchase, a lender is responsible § if a 2nd appraisal is obtained and more than 5% lower than for ensuring the property’s value is strong supported the value of the first appraisal (lower value must be used) • A property’s appraisal value must be supported with § the borrower does not pay for 2nd appraisal validated comps from the lender • A property is not eligible if resold 90 days or less after to protect the borrower from current owner/seller aquistion date predatory lending • Exceptions § Investor is an employer or relocation company Fannie Mae purchasing a property to relocate an employee • No Rules for Property Flipping § Resale of HUD Real Estate Owned properties (Additional underwriting guidelines may apply at § Property is acquired through inheritance lender’s discretion) § Sales by other government agencies or builders selling a new home § Freddie Mac Sales of non-profit agencies approved to purchase • No Rules for Property Flipping HUD properties PROOF( Additional underwriting § Sales of properties by federally chartered instituitons or GSEs guidelines may apply at lender’s discretion) § Sales of properties in federally declared disaster areas

Lender must obtain a 12-month chain of title to document time restrictions above. Guidelines are subject to change without notice and are neither a loan commitment nor a guarantee.

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