Editor’s note: This post was originally published in November 2007 and has been substantially updated in 2026 to reflect current FHA condominium approval rules, including the Single-Unit Approval pathway and today’s recertification process.
Why you should make sure your condo is on the FHA approved list
If you own or are buying a condominium anywhere in Washington State, it’s worth checking whether the project is on HUD’s FHA-approved condominium list — or whether your specific unit could qualify through Single-Unit Approval. Even if you’re not planning to sell or refinance anytime soon, a condo project that isn’t FHA-approved can limit your buyer pool and, over time, put downward pressure on resale values throughout the complex.
FHA-insured financing lets buyers purchase with as little as 3.5% down, and it remains one of the more forgiving programs for borrowers who don’t have top-tier credit scores. With fewer specialty first-time buyer programs available than in years past, FHA financing is still a popular path into homeownership — which means a non-approved condo project is quietly screening out a meaningful share of potential buyers.
How FHA condo approval works today
FHA condominium approval operates at the project level: the HOA or its property management company submits documentation to HUD covering the project’s budget, reserves, insurance, and governing documents, and HUD reviews the project against HUD Handbook 4000.1. Once approved, individual units within the project become eligible for FHA financing.
Some of the current requirements a project must meet include:
- A minimum percentage of units must be owner-occupied.
- No more than 15% of units can be more than 60 days delinquent on HOA assessments.
- The annual budget must allocate at least 10% of aggregate monthly assessments to reserves.
- Adequate reserve funding must be in place for future repairs and capital expenditures, separate from the operating account.
- The project must carry proper insurance coverage, including fidelity bond coverage where applicable.
- No single entity may own more than a limited share of total units, and the project must be free of pending legal actions that could affect its viability.
[VERIFY: confirm current owner-occupancy percentage threshold and any NAF-specific overlays on FHA condo project review before publishing.]
Approval isn’t permanent. FHA condo approval is valid for three years, and the HOA must recertify before it expires to keep units eligible for new FHA loans. If a project’s status shows as “expired” on HUD’s lookup tool, that doesn’t necessarily mean the building has problems — often it just means no one on the board pushed the recertification paperwork through in time. Either way, an expired project is closed to new FHA buyers until recertification is complete.
Single-Unit Approval: an option when the whole project isn’t listed
Since 2019, HUD has offered a Single-Unit Approval pathway that can let an individual condo unit qualify for FHA financing even when the overall project isn’t on the approved list. To qualify, the project generally needs to be complete, have at least five units, not be manufactured housing, and meet a subset of the standard project requirements, including caps on FHA concentration and owner-occupancy standards. This has largely replaced the old “spot approval” process referenced in earlier versions of this post, and it can be a helpful workaround for buyers in projects where the HOA hasn’t pursued full project approval.
[VERIFY: confirm current Single-Unit Approval eligibility details and any lender-specific documentation requirements before publishing.]
How to check your condo’s status
You can search HUD’s FHA-approved condominium lookup tool by location, project name, or status to see whether your complex is currently approved, expired, or was never submitted. Your Home Owners Association or property manager should also be able to confirm status and, if needed, initiate the recertification process. Keep in mind that if your condo has multiple phases, each phase is often evaluated separately — one phase being approved doesn’t guarantee the others are too.
Read: FHA Mortgage Guide for Washington State
Why this matters for Washington condo owners
Current FHA loan limits vary by county and are updated annually — you can find this year’s figures in my 2026 FHA Loan Limits for Washington State post. If your condo’s value falls within FHA’s limits for your county, keeping the project on the approved list helps protect your pool of qualified buyers — and by extension, resale values for everyone in the complex.
It also matters for owners who may need to refinance. FHA-insured refinancing isn’t credit-score sensitive the way many conventional programs are, and it can be a lifeline for owners facing financial strain who might otherwise be heading toward a short sale or foreclosure — an outcome that drags down values for neighboring units too.
If your project’s approval has lapsed or was never pursued, it’s worth raising with your HOA board. Recertification takes documentation and some lead time, so getting ahead of it — rather than scrambling when a sale or refinance is already in progress — protects everyone’s equity in the building.
Read: Financing a Condo in Washington State
FHA Condo Approval FAQ
What does it mean for a condo to be “FHA approved”?
It means HUD has reviewed the condominium project — not just one unit — and confirmed it meets requirements around owner-occupancy, reserves, insurance, and financial health. Once approved, any unit in the project can be purchased or refinanced with an FHA-insured loan.
How long does FHA condo approval last?
Three years. The HOA must recertify before the approval expires to keep units eligible for new FHA loans. An expired status doesn’t necessarily mean the building has issues — often it just means recertification paperwork wasn’t submitted in time.
Can I still get an FHA loan if my condo isn’t on the approved list?
Possibly, through HUD’s Single-Unit Approval pathway. This can allow an individual unit to qualify for FHA financing even when the overall project isn’t approved, as long as the project meets certain size, completion, and financial requirements.
How do I check if my condo is FHA approved?
You can search HUD’s FHA-approved condominium lookup tool by location, project name, or status, or ask your HOA or property manager directly. If your complex has multiple phases, check each phase separately.
Why does this matter if I’m not planning to sell or refinance?
A non-approved project shuts out FHA buyers, who make up a large share of purchase activity, particularly first-time buyers. Fewer eligible buyers can mean lower sale prices in your complex, which affects everyone’s equity — not just sellers.
Last reviewed: July 2026
About Rhonda Porter
we have 40 two unit buildings inour condo complex, one above the other. could it be called duplexes?
Dale, it sounds like condo’s to me. It cannot be both condo and duplex (as far as a lender is concerned).
how long does it take to have a builder have it’s last 10% new construction condo/townhouse aprroved from fha so he can sell his few units left to fha aprrove buyers?
Dont forget to remind these homeowners that they are the HOA. If an HOA is being “lazy” then that homeoowner is just as at fault. If your client wanted the HOA to be proactive on this item, I hope you encouraged your client to participate with their board! I say this because its easy to assume that someone else will do this work, but in an HOA every homeowner should pull their own weight. If you dont know what an HOA is and how they are operated, make sure you research it!
D, I know this all too well. The last condo I lived in, I wound up being elected to VP of the HOA…it’s not a fun job but someone had to do it!
I’ve always felt that you shouldn’t just sit back and gripe if you’re dissatisfied–get involved!
By the way, with loan limits currently at $417,000 and $567,500 for FHA Jumbo/High-Balance for King, Pierce and Snohomish counties–there is even more incentive to make sure your condo is FHA approved. Plus conventional mortgages currently have a price hit of 0.75% if you have less than 25% home equity (or down payment) and if your mortgage is amortized more than 15 years (such as a 30 year fixed)!
I am on the Board of a Condo Complex in Utah. I have been trying to find out how to get our complex on the approved list for days now. I even called the Denver office of FHA to get instructions and they did’t have the answer. They said I should talk to a mortgage underwriter. How are we to get approved if no one can tell us what we need to do to make it happen? Joy