Re: FHA's waiver of Anti-Flipping law extended again

I have several conventional Fannie Mae guideline lenders on a current transaction that are saying the new guideline is 15%. This is not FHA, but Fannie Mae. So, I am not sure if the 20% guideline has been changed?

When the asking price is greater than 20% of the purchase price, the Seller has to provide copies of all receipts for 'capital improvements'. They can only be materials and labor. This is added to the purchase price and then the 20% is applied to that sum. If over 20%, then I believe additional appraisals are required. Another suggestion is to portion out the personal property (appliances, HVAC, etc.) and sell that separately to the buyer. Personal property can be considered outside the 20% guideline.

Example: $100,000 purchase price + $20,000 receipts = $120,000 X 1.20 = $144,000 allowable sale price.