Hey guys,
I bought a home in September and completly rennovated it. It has been under contract with a realtor and we have a purchase agreement that we should close on the 13th. However, we the bank just informed us that the buyer only has 5% to put down, but they need 10%. So our new option is to go FHA, but I heard you cannot use FHA if the house was bought within 12 months. Is that true? Do I have any other options (raise my purchase price, but give them the extra 5%)?
Thanks for your help!
Monchew,
FHA requires a 90 day seasoning period. After that you should be fine. Incidentally you cannot raise your sales price to give them 5%.
What does seasoning mean?
There is amn “Investing Glossary” link in the left margin under “Investor Information”:
Seasoning - loan which has been in force for a period of time thus establishing the borrower’s payment history, loans are tyically deemed to be seasoned after either six months or one year.
Keith
Ahhh, I see.
Thank you guys. You are great. I think just after reading this my blood pressure went down.
I wish I had a link to source, but I heard from a local lender that currently there is no FHA seasoning requirements. Ask your local lender for more info
Seasoning is only waived for lending institutions/banks, not private owners. It is 90 days currently.