HUD is easing the requirements for condo approvals for a limited time. This is a great opportunity for home owner associations to submit their condo for HUD approval so that units in the condominium may be eligible for FHA financing.
Having your condo approved for FHA financing allows for more people to have a chance to buy a home. I would argue that it potentially increases the values of the condo as there are more financing options for potential buyers and those who want to refinance and it encourages owner occupancy.
Although FHA loans offer minimum down payment options, it’s not limited to first time home buyers. FHA loan limits are higher in some counties, like King County, Snohomish County and Pierce County. The 2015 loan limit for the tri-county area is $517,500.
From HUD’s announcement today:
Effective immediately, FHA’s temporary guidance will streamline the agency’s condominium recertification process and expand the eligibility of acceptable ‘owner-occupied’ units to include second homes that are not investor-owned. Read FHA’s mortgagee letter.
These provisions will expire in one year and serve to revise FHA’s condominium approval process until the agency can implement a more comprehensive condominium rule change. Today’s guidance:
- Modifies the requirements for condominium project recertification;
- Revises the calculation of FHA’s required owner-occupancy percentage; and
- Expands eligible condominium project insurance coverages.
Don’t assume that your condo is FHA approved. FHA aprovals expire and require recertification. You can check to see if your condominium complex is approved for FHA financing by doing an online search here. Be sure to check the far right column to see when/if the approval is expired (or expiring). If your condo is not approved or is set to expire, you should contact your home owners association to have them take advantage of this limited time opportunity to have the condo recertified.
If I can help you with the financing of your condo, townhome or detached home, located anywhere in Washington state, please contact me!