You've found a recently renovated home that checks every box. The kitchen is brand new, the floors gleam, and the price fits your budget. You're planning to finance with an FHA loan — and then your lender flags a problem. The seller bought the property just two months ago. Because of the FHA flip rules, you can't move forward with that financing. At least, not yet.

This is a scenario that catches many buyers off guard, especially in markets where investor-renovated properties are common. The FHA has specific restrictions on how quickly a property can be resold using FHA-insured financing, and those restrictions can delay or even derail a purchase if you aren't aware of them early.

Here's what these rules actually say, how they work, and what you can do if the home you want falls into a restricted window.

Why the FHA Flip Rules Exist

The Federal Housing Administration exists to make homeownership more accessible, particularly for buyers who may have smaller down payments or less-than-perfect credit. According to HUD, FHA-insured loans require a minimum down payment of just 3.5%, which makes them a popular choice for first-time buyers.

But that accessibility also means FHA borrowers can be vulnerable to inflated property values. In the early 2000s, a pattern emerged: investors would buy a home cheaply, make minimal cosmetic changes, and immediately resell it at a steep markup — often to FHA buyers who relied on the appraisal to confirm the property's value. The buyer ended up with a mortgage larger than the home was worth, and the investor walked away with the profit.

HUD introduced the property flipping regulation (24 CFR 203.37a) to address this. The rule doesn't ban house flipping outright. It restricts how quickly a property can change hands when FHA financing is involved, creating a cooling period that gives appraisals more time to reflect real market value.

The 90-Day Rule: A Hard Stop

The core of the FHA flip rule is straightforward: a buyer cannot use FHA financing to purchase a property if the seller acquired it less than 90 days ago.

This is a firm restriction — no amount of renovation, documentation, or good intentions changes it. If the seller has owned the home for fewer than 90 days at the time you sign the purchase contract, FHA financing is off the table for that transaction.

How the Timeline Is Calculated

This is where many people get confused, and the details matter. The 90-day clock starts from the date the seller's deed was recorded — not their closing date, not the date they listed the property, and not the date they started renovations. It runs to the date you and the seller execute (sign) the new purchase contract.

This distinction between the deed recording date and the contract signing date trips up even experienced agents. Always ask your lender or title company to verify the exact recording date before you write an offer on a recently acquired property.

FHA Flip Rule Timeline: What Applies and When

The restrictions don't end after 90 days — they just change. Here's how each window works:

FHA Flip Rule Restrictions by Timeline

Timeline (From Seller's Deed Recording)	FHA Status	What Happens
0–90 days	Blocked	FHA financing is not allowed. No exceptions for most residential transactions. The purchase contract cannot be signed during this window.
91–180 days	Conditional	FHA financing is allowed, but the lender may require a second independent appraisal if the resale price has increased significantly. If the second appraisal comes in more than 5% below the first, the lower value is used for the loan.
181+ days	Clear	Standard FHA guidelines apply. No flip-related restrictions or extra appraisal requirements.

The 91–180 Day Window: Conditional Approval

Getting past the 90-day mark doesn't mean you're in the clear. If the property is resold between day 91 and day 180, additional scrutiny kicks in — particularly if there's been a large price increase.

Here's what to expect:

• Your lender will compare the seller's original purchase price to the current resale price.
• If the price increase raises red flags (often defined as 100% or more, though lenders can apply their own thresholds), a second independent appraisal is required.
• The buyer cannot be charged for this second appraisal — the cost falls on the lender or seller.
• If the second appraisal is more than 5% lower than the first appraisal, the lower value must be used to calculate the loan amount.

What does that look like in practice? Say you offer $300,000 on a home the seller bought for $140,000 four months ago. That's a 114% price increase. A second appraisal comes in at $280,000 — more than 5% below the first appraisal of $300,000. Your loan amount would be based on $280,000, which means you'd either need to cover the $20,000 gap out of pocket or renegotiate the price.

According to the Consumer Financial Protection Bureau, understanding your home's appraised value relative to the purchase price is one of the most important steps in the loan process — and that's especially true in flip situations.

Exceptions to the FHA Flip Rule

The rule has a specific list of exemptions. If the property falls into one of these categories, the 90-day restriction and the 91–180 day second appraisal requirement don't apply:

Properties Exempt from FHA Flip Restrictions

Exception Category	Details
HUD REO Properties	Homes acquired by HUD as part of an FHA insurance claim and sold through HUD's REO program.
Bank-Owned / Government REOs	Properties sold by lenders, Fannie Mae, Freddie Mac, or other government agencies after foreclosure.
Inherited Properties	Homes sold by someone who inherited the property. The seller didn't "buy" it — they received it through inheritance.
Employer / Relocation Sales	Properties sold by an employer or relocation agency as part of an employee relocation program.
New Construction	A builder selling a newly built home. The property didn't exist before, so there's no prior acquisition to measure against.
Declared Disaster Areas	Properties located in federally declared disaster areas, where faster resales serve a rebuilding purpose.

If you're looking at a property that might fall into one of these categories, ask your lender to verify the exemption before assuming it applies. Documentation matters here — a relocation sale, for instance, needs proper paper trails.

What If the Home You Want Doesn't Qualify?

Finding out the property you've chosen falls within the FHA flip restriction doesn't have to end the deal. You have options — though each comes with trade-offs.

Option 1: Wait It Out

If the 90-day window is close to expiring, it might make sense to delay signing the purchase contract by a few days or weeks. Some sellers will agree to this, especially if you're the strongest offer. Just keep in mind that you can't sign during the restricted period and then simply delay closing — the contract execution date is what counts.

Option 2: Use a Different Loan Program

The FHA flip rule is specific to FHA-insured loans. Conventional loans, VA loans, and USDA loans don't have the same 90-day restriction. If you qualify for one of these programs, you may be able to purchase the property without any timeline issue.

That said, switching loan types isn't always simple. FHA loans have more flexible credit requirements — according to HUD, borrowers with credit scores as low as 580 can qualify for the 3.5% minimum down payment, while most conventional programs need a 620 or higher. If your credit profile is the reason you chose FHA in the first place, a conventional loan might require a larger down payment or may not be available to you at all.

A conversation with your lender about your full financial picture is the right starting point. You can explore the range of mortgage loan programs to see what fits.

Option 3: Walk Away

Sometimes the math doesn't work, the timing doesn't align, and the best move is to keep looking. It's not the answer anyone wants to hear, but buying a home with inflated value carries long-term risk — and the FHA flip rule exists precisely to protect against that.

How to Protect Yourself as a Buyer

A few practical steps can save you significant time and frustration:

• Check the property's ownership history early. Public records, title searches, and your real estate agent can tell you when the seller acquired the home. Do this before you write an offer.
• Ask your lender about flip rule compliance. If you're using FHA financing, your lender should be screening for this. But it doesn't hurt to bring it up proactively, especially if the home looks recently renovated.
• Understand the recording date vs. closing date distinction. The deed recording date — when the deed was officially filed with the county — is the only date that matters for this rule.
• Get pre-approved before you shop. Knowing your loan type and qualification details ahead of time means fewer surprises. You can use a mortgage calculator to start estimating your numbers.
• Don't rely on the seller's word. Always verify dates through official records or title work.

Frequently Asked Questions About FHA Flip Rules