90 Days: The FHA Rule That Can Sink Your Offer on a Renovated Home

90 days. That's the number that can make an FHA loan completely ineligible on a home you've already fallen in love with, no matter how strong your credit or how perfect the renovation looks.

Consider a situation that comes up often for FHA buyers: someone finds a beautifully renovated home, like the kind Zoe was looking at near Aynor, SC, and starts picturing moving day before anyone checks one critical detail - when the seller actually acquired the property.

Why the Resale Timeline Matters

Renovated and flipped homes move fast. Sellers buy a distressed property, fix it up, and list it again within weeks or months. That's great for curb appeal, but FHA has specific rules about how soon a property can be resold after the seller's purchase date, and those rules exist to protect buyers from inflated flip pricing.

If Zoe had written an offer without checking that date first, she could have ended up under contract on a home that simply wasn't eligible for FHA financing at all.

What the Guideline Actually Says

Here's the exact language that governs this: "A Property being resold 90 Days or fewer following the seller's date of acquisition is not eligible for an FHA-insured Mortgage. If the resale date is between 91 and 180 Days and the resale price is 100 percent or more over the seller's acquisition price, a second appraisal is required."

In plain terms: if the seller bought the home and is reselling it within 90 days, FHA financing is off the table entirely. If it's been 91 to 180 days and the price has roughly doubled, you'll need a second appraisal, and if that second appraisal comes in more than 5 percent lower, the lower number is what the loan is based on. The cost of that second appraisal can't be passed on to the borrower.

How Zoe Handled It

Before writing an offer, Zoe asked her agent a direct question: can you provide the seller's deed or settlement statement showing the date they acquired this property, so we can confirm FHA eligibility before we go under contract? That single request gave her the answer she needed before she was financially or emotionally committed to a deal that might not close.

What You Can Do Today

If you're an FHA buyer considering a recently renovated or recently resold home, get the seller's acquisition date in writing before you write an offer. It takes five minutes and can save you weeks of frustration, or worse, a dead deal right before closing.

I work with FHA buyers across the Charleston area and beyond on exactly these kinds of questions. If you've found a flipped home you love and want to make sure it's actually eligible before you go under contract, give me a call at 843-LOW-RATE. I'm Jason Sharon with Home Loans Inc, and I find the path.

Home Loans Inc - Jason Sharon, Mortgage Broker. Company NMLS #1728740, Jason Sharon NMLS #1281448. Equal Housing Opportunity.

Learn more about this loan program: 90 Days