"FLIP THAT HOUSE!"

This is a temporary waiver of FHA's "90 Day Flip Rule" and will expire January 31, 2011 unless extended. Following are details of the waiver:
1. The waiver is effective for properties which have been owned less than 90 days that meet the following criteria:
- Must be an arms-length transaction with no identity of interest between Buyer and Seller or other parties participating in the sales transaction.
- LLCs, corporations or trusts as Sellers must have been established and operated in accordance with applicable State and Federal law.
- No pattern of previous flipping exists such as multiple transfers of title within a 12 month timeframe as indicated on the chain of title on the Appraisal.
- Document that property was marketed openly and fairly through an MLS, an auction, For Sale by Owner or developer. Note: Sales contracts which have been assigned to the current Buyer are not allowed.
2. For property sales prices that are 20% or more above the Seller’s acquisition cost the following must be performed: Keep in mind that if the value increases by 100% or more, a second appraisal is required:
- Appraiser must indicate the Seller completed legitimate renovation, repair and rehabilitation work on the subject property to substantiate the increase in value.
- If the work was not performed, Appraiser must provide appropriate explanation of the increase in value since prior title transfer;
AND
3. The Lender must order a property inspection report and provide a copy to the purchaser prior to closing. Property inspections must include, at a minimum, the following:
4. Structure, including foundation, floor, ceiling, walls and roof;
5. Exterior, including siding, doors, windows, appurtenant structures such as decks and balconies, walkways and driveways;
6. Plumbing, electrical and heating and cooling systems;
7. All interiors; and
8. All insulation and ventilation systems, as well as fireplaces and solid-fuel-burning appliances.

Waiver is limited to forward mortgages only and does not apply to Home Equity Conversion Mortgage (HECM) for purchase program.

If you have any questions, please feel free to contact Jon A. Achilles at (480) 688-0656.