So, you just purchased a Louisville investment home and completed your flip in 4 weeks. Congratulations!
Unfortunately, selling your renovated project may not go as smoothly as you think. Everyone is aware that Freddie Mac and Fannie Mae homes come with a 90-day deed restriction when you purchase the home. But, there may be a holding period even if you do not have a deed restriction. There is a little-known (at least in my area) 2003 rule that was implemented to help prevent predatory flipping. The consequence to investors is that if the buyer gets an FHA loan the closing cannot occur within 90 days of the last sale. If the property is being sold between 90-180 days for more than 100% of the purchase price, 2 appraisals are required and the seller will have to pay for one.
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Erik Hitzelberger is a licensed REALTOR with RE/MAX Alliance in Louisville. If you need a Louisville Real Estate agent please email me or call 502.921.3989.
I specialize in the following areas of the Metro Louisville Area: Prospect, Middletown, Jeffersontown (J-Town), Fern Creek, Okolona, Shepherdsville, Mt Washington, Hillview, Brooks and Pewee Valley. Click the following links to learn more about Louisville and Bullitt County Real Estate or to Search for Louisville Homes
Amy - If you are buying a property with a deed restriction, the buyer does have to sign extra documentation. However, this rule applies to properties without deed restrictions. It is essentially a post-purchase restriction that says FHA will not insure any loan unless the property has been owned for at least 90 days.
Renee - It applies to every loan that a buyer tries to get FHA insurance on.