I'm ready to sell my flip property where most of the buyers are using FHA/VA loans. I'd prefer to avoid FHA, so I'm looking strongly at one of the VA offers I received. According to my broker's favorite loan officer, VA flip rules are the same as conventional. Is this true?

Here's what she sent on VA/Conventional flip rules:

And for good measure, here's what she sent me for FHA flip rules:

Anyway, I wanted to see if I could get some independent verification that the VA process isn't going to be as cumbersome as the FHA program. Any insights on how I can follow-up with the broker on a VA loan to ensure the process will run as smooth as possible is welcome as well.

From the standpoint of the rehabber, selling FHA and VA are pretty equivalent these days. Both will require some hoops to jump through -- additional documentation, additional substantiation of value, etc. -- but either can be accomplished pretty consistently if you have a GREAT mortgage broker handling the transaction who understands the rules and can communicate directly with the underwriter.

So, I would suggest you focus on finding a GREAT mortgage broker, and then not worry so much about whether your buyer is FHA or VA.

Now, all that said, if I had to choose, I'd rather have an FHA buyer than a VA buyer, as VA tends to be a lot more picky on inspection issues and the underwriters tend to be a lot more finnicky. In my experience, VA loans typically take an extra week to close, all other things being equal.

Thanks for the response! I was expecting VA/FHA to have similar protocol instead of VA/Conventional as was suggested to me.

Originally posted by @Drey Taylor:

Thanks for the response! I was expecting VA/FHA to have similar protocol instead of VA/Conventional as was suggested to me.

 From the rehabber's perspective, Conventional is actually pretty similar as well these days.

It's easier from the buyer's perspective, but that probably doesn't affect you very much...

@J Scott It's been a while since I posted this, but I thought I would provide a late update that the sale with VA financing went through without a hitch! I was pleasantly surprised. In fact it was the two "cash" offers I received before accepting the VA offer that were difficult and ended up falling through.

I'm curious- How are you handling the 90 day seasoning rules going back into effect?  Do your rehabs generally take longer before you're ready to list, or are you selling early and jumping through hoops with an experienced broker that you recommend (require?) your buyers to work with?  On some of the leads we're looking through, we would be able to be show ready in a couple weeks and having to hold until 90 days would be very costly.  I'd like to know if we can create a viable path to selling quickly or if we need to make sure we work in extended holding costs into our deals.

Originally posted by @Drey Taylor:

I'm curious- How are you handling the 90 day seasoning rules going back into effect?  Do your rehabs generally take longer before you're ready to list, or are you selling early and jumping through hoops with an experienced broker that you recommend (require?) your buyers to work with?  On some of the leads we're looking through, we would be able to be show ready in a couple weeks and having to hold until 90 days would be very costly.  I'd like to know if we can create a viable path to selling quickly or if we need to make sure we work in extended holding costs into our deals.

First, congrats on the sale!

Unfortunately, if you're going to deal with FHA buyers, there's no way around holding for 90 days at this point. So, my recommendation is to look for non-FHA buyers or encourage your FHA buyers to shop for conventional loans (which can be had for 3% down these days, which is comparable to FHA terms).

Originally posted by @Drey Taylor:

@J Scott It's been a while since I posted this, but I thought I would provide a late update that the sale with VA financing went through without a hitch! I was pleasantly surprised. In fact it was the two "cash" offers I received before accepting the VA offer that were difficult and ended up falling through.

Just wanted to say that as a Vet, I appreciate you going with the VA Loan. You just made this vet VERY happy. When shopping for my home, some sellers did not want to deal with us because of our VA Loan. Understood but from a Vet buyer's standpoint it was just one more hurdle we had to overcome. So THANK YOU.

I know this post is relatively old but I found it. I wanted to make sure no one is going in the wrong direction for todays guidelines. FHA Flip rules have chanced and as of March 2016 no longer allow for less than 90 days between purchase and sale. 90-180 days requires two appraisals.

@Nic A. odd, I sold a home in March 2016 (closed April 1) to an FHA loan, and there was only one appraisal.

I also sold my next house to a VA loan, and had no hoops to jump through. No one asked me to verify the difference in what I paid and what I sold it for. I wonder if these things are specific to regions or not?

Originally posted by @Brian Pulaski :

@Nic A. odd, I sold a home in March 2016 (closed April 1) to an FHA loan, and there was only one appraisal.

I also sold my next house to a VA loan, and had no hoops to jump through. No one asked me to verify the difference in what I paid and what I sold it for. I wonder if these things are specific to regions or not?

 The key question is when did you purchase them ?

one was purchased Nov 2015, the FHA house. The VA house was purchased March 2016. I forget exactly but it closed in August I believe.

Originally posted by @Brian Pulaski :

one was purchased Nov 2015, the FHA house. The VA house was purchased March 2016. I forget exactly but it closed in August I believe.

 Hi Brian this may not apply to you since it was more than 90 days between purchase and sell.