Will this change affect property flipping requirements for Home Equity Conversion Mortgage (HECM) properties? Will HECM property flipping applications now be required to submit three appraisals?

Per Mortgagee Letter 2018-06, for all HECMs 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2018, additional valuation protocols required for re-sales occurring between 91 and 180 days following acquisition are superseded.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 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