Flip my Real Estate in Florida
Florida all of a sudden has become a great place for Flips again. Real Estate is selling like hotcakes here in South Florida. In many cases a cash buyer is selling to another cash buyer who will rent the property so the flip is a non-issue but just in case a cash buyer is buying, fixing up and selling to an FHA borrower, here are some useful things to know.
A Flip was a "four letter word" made popular back in 2005 and 2006 when investors were taking advantage of the real estate markets appreciating at an alarming rate. Basically it is like stock speculation where the savvy investor bought low and sold higher.
After the whole mortgage meltdown that occurred in 2007-2009 our lending authorities such as Fannie Mae, Freddie Mac and especially FHA put some "overlays" on our flip guidelines that sort of discouraged flipping and investors. They could still buy and sell the properties, the agencies just sort of slowed them down so their carrying costs got a little higher and made their life a little more difficult.
Instead of allowing the investors to buy a property and turn around and sell it the next day, many of the flipping guidelines made the investor hold on to that property for six months or more.
Now that the our South Florida lending environment is starting to open up again, I am happy to say that my employer, a bank in Florida has some excellent programs with regard to Flips. We can help you from day one so please call me. 561-329-0075
Here are the latest guidelines for investors and Flips:
What is the FHA Flip Policy less than 90 days and the increase in value is over 20% with our Investors?
A 2nd appraisal from a FHA approved appraiser from RELS Valuation and a Home Inspection are required. The RELS appraisal must be within 95% of the 1st appraisal value. The Home Inspection will be underwritten for any health and safety items that need repairing.
What is the FHA Flip Policy less than 90 days and the increase in value is under 20% with our Investors?
A home inspection is required and will be underwritten for any health and safety items that need repairing.
What is the Conventional Flip Policy with our Investors?
If the Seller has held the Subject property more than 30 days but less than 90, then a Field Review is required when the value increases more than 20% from the original purchase price. The original appraiser must list the documented improvements within the appraisal report to support the value increase. Non-Armâ€™s Length transactions are not permitted
Every situation is unique so please call me with your scenario 561-329-0075