If a HECM Collateral Risk Assessment is completed will an additional appraisal be required under the property flipping rules?

Per Mortgagee Letter 2018-06, for all Home Equity Conversion Mortgages (HECMs) with FHA case numbers assigned on or after October 1, 2018, additional valuation protocols required for re-sales occurring between 91 and 180 days following acquisition are superseded.  The 90-day prohibition remains in place.  Property flipping HECM cases are subject to FHA’s collateral risk assessment.

 

HQ Policy Determination

For additional information see Mortgagee Letter 2018-06 and 2019-16 available at: https://www.hud.gov/program_offices/administration/hudclips/letters/mortgagee


All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.


Topic Number: 2018-0027