There is a property that client pick up from Fannie Mae for a great deal. Before we got into contract, I saw a Deed Restriction that I can’t sell no more than a certain amount for three months. My question is: has anyone done deal with these deed restriction? we don’t mind waiting for the deed restriction to expire as it help with the FHA buyer as well. There is a 90 days flip rule for some potential buyers who finance with government loan.
They do place the deed restrictions on some properties. When given a restriction you just can’t close on the sale in less then 90 days. It is not easy to buy, renovated, resell and close in under 90 anyways so I would not worry much about it. Just be aware that you can’t close on your re-sell any faster than 90 days.
Jim
[QUOTE=jimingersoll;883811]They do place the deed restrictions on some properties. When given a restriction you just can’t close on the sale in less then 90 days. It is not easy to buy, renovated, resell and close in under 90 anyways so I would not worry much about it. Just be aware that you can’t close on your re-sell any faster than 90 days.
Jim[/QUOTE]
Im with this guy.
Even people like me who know exactly what they are doing, rarely have a problem with the 90 days holding up any closings.
The 90 day deed restriction on sellers is little different than the 90 day seasoning for FHA buyers. The deed restriction DOES allow you to sell before 90 days. You just can’t sell for more than 20% of purchase price. Since that would kill most rehab deals (and many wholesale deals), you just wait out the 90 days.
The 90 day seasoning issue for buyers getting FHA financing also has the same 20% above purchase price restriction. However, the buyer’s lender can allow the purchase before the 90 days is up with a second appraisal and documentation of repairs/improvements.
Neither one of these things should be a deal breaker.