I was told I’m buying a home that was flipped and that I have to get a second appraisal. How does that work?
If the home you’re buying is considered a “flip" and you’re getting a higher-priced mortgage loan covered under new mortgage rules, you will have to get a second appraisal.
A “flip” is when:
- You buy a home from a seller who bought the home less than six months ago and;
- You pay a certain amount more than the seller paid for the home:
- 10 percent more if the seller bought the home within the past 90 days.
- 20 percent more if the seller bought the home in the past 91 to 180 days.
When you buy a “flipped” home, your lender must pay for a second appraisal of the home that includes an inside inspection. The lender cannot charge you for this second appraisal.
Keep in mind that not all flips are subject to this requirement. For example, flips in rural areas are exempt because those areas might have fewer appraisers available. Also, properties acquired from a government agency are exempt.
If you have a problem with your mortgage, you can submit a complaint with the CFPB online or by calling (855) 411-CFPB (2372).