Is There a Way Around the 90-Day Flipping Rule?

Question

Hello,

I was wondering if there is any workaround for the 90-day flipping rule. The challenge I face is that all my property flips are completed in under 6 weeks. Consequently, every time I list a property on the market, FHA buyers are disqualified due to the 90-day ownership requirement. I'm operating in the Florida market.

Thanks!

Pham Quang · Answer

There are a few exceptions to the FHA 90-Day Flip Rule, but realistically the only practical option are resales by HUD.

One of my investors has a very efficient process with his flips (6-8 weeks, sometimes less depending on work needed), and his solution is to always buy and keep 1 or 2 properties "in the pipes" while his crews finish up previous ones. Not really a way around, but just how one person deals with it.

But I'd say you have an efficient process as well. .

Nate Herndon · Answer

Sounds like you are really moving! That's really impressive. Many of my clients who choose to hold properties refinance in under 90 days at 120% of cost basis or 75% of ARV, whichever is less.

If you ever ventured into leasing with an option to buy, that might help with the turnaround.

Peter Vekselman · Answer

this comes with the territory.  but if these types of deals and buyers are working for you, dont change a thing.  you got a working model!!!

Jonah Slove · Answer

what about a home that I have taken ownership of either through a deed in lieu of foreclosure or a foreclosure? Or can my FHA buyers get the home through the foreclosure sale?

I was a lender on this property and my borrower defaulted. I have FHA buyers lined up.

Arran Mcconnell · Answer

I just ask if my buyers want to switch over to conventional. I was having this problem on every flip when interest rates were at 4%. Now my turn time usually falls around 4 months.

Bill J Fay · Answer

Negative. But hey, that means you are flipping very efficiently!

Mike Romano · Answer

Thank you to all for your help.

Wayne Brooks · Answer

@Mike Romano Nope, no way around it.

Teri Feeney Styers · Answer

@Mike Romano homes that were purchased through HUD (repos) are exempt from the rule.

Is There a Way Around the 90-Day Flipping Rule?

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