On Friday, the Federal Housing Administration (FHA) extended its temporary waiver of the “anti-flipping rule” through the end of the year. The extension is intended to accelerate the resale of foreclosed-upon homes in neighborhoods struggling to overcome possible property abandonment and blight.
With certain exceptions, FHA regulations prohibit insuring a mortgage on a home owned by the seller for less than 90 days. Early last year, the FHA temporarily waived this regulation through Jan. 31, 2011. This action will permit buyers to continue to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales. It will allow homes to resell as quickly as possible, according to the FHA, helping to stabilize real estate prices and to revitalize neighborhoods and communities.