Why to hold properties for at least 90 days on a fix and flip?

Why to hold properties for at least 90 days on a fix and flip?

Why do fix and flippers hold their properties for at least 90 days before putting them on the market, especially when it's a median-priced neighborhood. So, in this video today, we're going to discuss that and if you like this information, please go ahead and subscribe to this channel, make a comment, and we can answer any questions question you have. Welcome to Wealthy Wednesday.

Now, the number one reason investors hold their property for 90 days at least, is the FHA financing for the buyer who buys the property, has a rule. And the rule is the seller has to hold the property minimum for 90 days. Even on a conventional loan, if the property is not held for at least 90 days, there could be more documentation of the repairs and details, the seller may have to provide to the bank. So what happens in a median-price neighborhood? The FHA loan limit differs from county to county and then also the time, it's approximately $450,000, give and take. Little more, a little less. So if your resale value of the home in a neighborhood, especially if it's a single-family home, what most of the fix and flipper do, you have to wait for 90 days. Because most of the buyers who are going to make the offer are first-time home buyers and they're getting FHA mortgages, most of them. So that's where your chunk of the buyers are coming to make offer on your property. So when you acquire a property, you got to make sure who is your end customer and you got to prepare for that. When you get a property, you don't need to rush to get all the repairs done. You have 90 days. 

Again, in a market where the resale value is at around $470,000 price range, you have enough time, you have at least two and a half months to get the property ready and then put it back on the market. Because again, when that FHA buyer makes an offer on your property and the appraiser comes, you're not going to have any problem because it's enough time to hold the property as the owner. If not, if you get a contract, say in 60 days, you may have to give a lot of documents about what repair you did, all the details and it's just more paperwork. So hopefully this information going to help you make your next fix and flip a smooth transaction. My name is Shawn Bhakta from Remax Presidential, South Florida Home Finder Team. I am glad to help.

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