I was looking at a property in the area to flip but it was part of the "Homepath" program where owner occupants get first dibs within first 15 days. After learning about it, I actually thought to knock down the house, build a house, and live there for 2 years. I found that my offer got rejected and went to an investor. The annoyance here is that he bought it was an "owner occupant" although he bought, flipped, and now sold the house within 3 months. But he bid during the "owner occupant" time period. I heard he got docked 10,000 for selling within two years. Is anyone familiar or understand the rules behind selling before 2 years is up when you buy a homepath property under 2 years.
Some investors will buy as "owner occupants" to try to cheat the system. However there are fines and penalties for doing this.
When buying as an owner occupant, you must sign an affidavit stating that this house will be your primary residence and you will live in the property for 1 yr (however, I think some programs may still require 2). This is a legally binding document and someone found in violation of the HUD rules can face up to 2yrs in prison and up to a $250,000.00 fine. If this person was found out and only had to pay $10k, they were lucky.
Numerous BP members will warn against playing games with the government. Simply not worth it.
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