FHA 90-day no-flip policy?

QuestionsFHA 90-day no-flip policy?
asked 4 years ago

Help!

 

I was just advised that we will not be closing on our home tomorrow.

 

Back story:

 

We were due to close on a home June 12th, but unable to because we were waiting on IRS transcripts and rate lock expired.  Sellers could not extend the closing because they were buying a house and their seller was not willing to extend.  Sellers agent stepped up to the plate, purchased the home for $ 5k less than our contract price with the intention of immediately flipping it to us for our original contract price.  Once that deal was done, my mortgage company stepped in and said the house could not be immediately flipped for a different price due to FHA guidelines, so the “new” seller agreed to sell to us at the price he paid.  We wrote a new contract with him and went back to UW.

 

UW approved the loan on Friday and the file was sent to the closing department for review today.  The closing department killed the deal saying the loan could not close due to FHA guidines of no flips within 90 days.

 

Their exact words to the title company were:

 

This loan will not be closing at all. The broker purchased the property which now makes it a flip and ineligible for a loan.  :smileysad:

 

My LO is floored as he has an email from someone higher up in his company stating it could close as long as the price didn’t change.  The person in closing department says he was advised wrong and their is nothing else they can do.

 

Please, someone tell me this is wrong and we will be able to work around this?!?!

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