What are FHA's seasoning requirements? I bought a house 2 months ago from HUD, rehabbed it and listed it for sale. I have an offer from an FHA buyer, just wondering if there are seasoning issues that will come up.
I don't believe a seller using FHA financing will have a seasoning. I think it only applies to you as the buyer. For example, I believe HUD used to require 90 days of seasoning before you could sell the property but I heard thats gone out the window. IF there is an issue put the property in an LLC and sell the LLC... not sure how/if you can do that with FHA financing since you're buying a business.
FHA doesn't have any restrictions on resale anymore, but there are a few things to watch out for:
- Even though FHA doesn't have the restrictions, some lenders/banks still impose the restrictions. So, make sure that the bank your buyer is using doesn't impose the restriction.
- Even though FHA doesn't have the restrictions, they are now more strict about ensuring that the renovation has verifiably increased the value of the property. The underwriter will likely require a second appraisal and may require receipts/documentation of the renovations.
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