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The 90 day rule for FHA loans is this: the seller must have owned the home for at least 90 days before selling it to a buyer who is using FHA financing.  A while back they removed bank foreclosures from this rule.  Now they have allowed individual sellers to sell their home before 90 days.  This is GREAT news.  But there is some things to know and consider:

1. FHA rule is they allow the seller to technically double what they bought the property for.  But over 100% will require a 2^nd appraisal
2. I can tell you for a fact, most banks will have an issue with an increase like that.  most banks will want a reasonable increase or proof of the work that was done to cause this decrease.  Or may also order a 2^nd appraisal
3. if it was bought recently then the original sale of the property could be used against it as a comparable sale.  Of course this depends on the appraiser and how many comps are available in the area.  I believe this would be a worse case situation

Bottom line, this is still great news.  Please call or email me with any questions.