The Federal Housing Administration has temporarily waived its restriction on financing recently sold properties.
FHA has a regulation that doesn’t allow FHA-insured loans to be used for the purchase of properties where the seller acquired the property within the past 90 days. There are some exemptions, however, to the regulation.
But the housing agency has temporarily waived that regulation, the U.S. Department of Housing and Urban Development said in a public filing today.
The waiver impacts all sales contracts executed between Feb. 1 and Feb. 1, 2011, though certain conditions apply.
Home-equity conversion mortgages are ineligible.
“During this period of high foreclosures, FHA seeks to encourage investors that specialize in acquiring and renovating properties to renovate foreclosed and abandoned homes,” HUD explained in the filing. “While the waiver is granted for the purpose of stimulating rehabilitation of foreclosed and abandoned homes, the waiver is applicable to all properties being resold within the 90-day period after prior acquisition, and is not limited to foreclosed properties.”
