Help...I have to wait 90 days to sell?

Question

hoping someone can assist. I purchased a house at sheriff sale 8/30, paid cash. I have a buyer and their bank is saying they cannot get a mortgage until its been 90 days since the previous purchase. I'm in ohio. Any direction would be hugely appreciated!!!!

Wayne Brooks · Answer

Have the buyer go to a different lender.  This is that banks's policy, not industry "law".  FHA doesn't even absolutely require 90 day seasoning any more.  Large banks are usually the worst at getting a loan done.

Jessica Russell · Answer

Thanks to you ALL so very much for the assistance.  I got very lucky that my buyer is bringing cash to closing.  Next time, I will be much for educated on the matter.  Thanks again!!!!

Mike G. · Answer

@Jessica Russell , there are many banks/lenders and some do not have the 90 day requirement.  If the buyer really wants your house, tell them to contact a mortgage broker who can find them a lender that won't require a 90 day wait.

Verran Jones · Answer

Bryan, thanks for that link I will use this information going forward.

Bryan R. · Answer

FHA Anti Flipping Regulation Waiver has been in effect for a number of years. Current extension is through 2014. Time period is calculated from settlement date.

https://www.federalregister.gov/articles/2012/11/29/2012-28918/federal-housing-administration-fha-temporary-waiver-of-fhas-regulation-on-property-flipping

Any other requirement is an overlay specific to the lender.

Find a LO who works with investors. They should know how to deal with this. Two typical methods are proof of value added and/or 2 appraisals.

Tim Melton · Answer

@Jessica Russell it sounds like your buyer is FHA and you're subject to their limitations.  90 day seasoning isn't uncommon in AZ (supposedly to allow any short term market adjustments to take place and have its bearing on value) for FHA buyers.  If they've just got the 3.5% down, then you've got to decide if it's worth the gamble to enter into a long escrow, or take the listing back to active in hopes of finding the right buyer with the right loan (or cash).  If you stick with the current deal, you could find out how much the buyers want the house by requesting that the earnest $ go hard after 45 days (and bump the earnest $ if it's low).

Hope that helps--Tim

Bryan L. · Answer

@Jessica Russell @John Rooster  - When I suggested that Jessica contact the best mortgage person in town, it wasn't necessarily because someone might know how to work around the rule or whatever (but they might), but also because there are thousands of loan programs available.  And a really good mortgage person may be able to get this deal done with a different type of loan product.  For example, in my area there is a "rural development" loan program that has not seasoning requirement.  Also, there is the option of a portfolio loan with a small local bank.  Again, a really good Realtor will know who to work with to get a deal done.  But if I were to bet on this, my bet would be that Jessica chose to sell this herself instead of enlisting the skills of a really good Realtor - but maybe I'm wrong.

John Rooster · Answer

I have been down this road many times. But I don't have a solution for you since the rules change all the time, and since it does not concern a significant percent of properties, there are no real expert mortgage brokers on the subject. I just wait the 3 months. A few times I have had to wait 6 months since the contract price was more than twice the purchase price. And FYI, they will start the clock the day the Deed is recorded, not the date of the sale.

Wayne Brooks · Answer

By the way, where 90 day restrictions do exist (2appraisals with FHA), that 90 days is for the actual closing of the sale.  The date of purchase contract doesn't matter.  To clarify, FHA has some restrictions, but many of the restrictions you will encounter are additional restrictions (overlays) imposed by the individual lender, usually more with the larger banks.

John Moore · Answer

What I've encountered, if you enter into an Agreement of Sale  prior to 90 days FHA requires 2 Appraisals; conventional does not have this requirement in my area, but requires more down payment. You might consider leasing the property to your prospect and then enter a sales contract on the 91st day, if you think they will be approved and need a place to stay.  Food for thought.

Help...I have to wait 90 days to sell?

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