Is flipping illegal in Texas?

General Real Estate Investing
1

I am getting many answers on this and it is propbably time to go to attorny for this one, but here it is:

Is it flipping in general illegal in Texas?
Is it true that I have to hold a home for 90 days before flipping in Texas?

Any other strings attached when flipping a property?

2

Read Bill Bronchick’s article and decide for yourself:

http://www.real-estate-online.com/articles/art-282.html

Keith

3

No, it is not illegal. No, there is no holding requirement. Whoever told you that is wrong, and should not be giving legal advice.

4

Howdy DFW-REI:

You may be confusing seasoning with flipping holding time. A lot of lenders require sellers to own property 6 months for instance before they will loan the buyers the money to buy the property. The only rules I know of are contract for deed and lease option financing are almost impossible in Texas

5

The only rules I know of are contract for deed and lease option financing are almost impossible in Texas.

Why is that ted?

6

Howdy Campbellgroup:

New laws have been passed where you have to own a house without a mortgage to lease option it and even worse for contracts for deed. There are fines and penalties too harsh to even consider either form of financing for me. Many landlords took advantage of tenant/buyers and took their money and kicked them out too fast even after paying large down payments. I do not know the laws very good but well enough to stay away.

7

In September of 2005 a law was passed that essentially states that if you have a contract for deed or a lease option of greater than 3 years then if you evict the tenant for non-payment you must forfeit ALL monies they have paid you since you’ve engaged in a sale of the property but the tenant has not gotten the benefits of home ownership (i.e. paying down the principle, capital appreciation etc).

8

Some types of financing require seasoning on the property. HUD requires 91 days from the previous sale to the execution of a new contract on all properties. No ifs ans or butts. So if you’re selling a house and the buyer is using FHA financing then the lender has to abide by HUD’s guidelines in order to get the loan insured by HUD.

Don’t confuse ‘legal / illegal’ with lender requirements. Any lender can require anything they want provided it doesn’t violate the ECOA based on race, gender, religion, etc.