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HUD/FHA Approval For Condominium Complexes
It is important for Your Condominium Community to Be HUD/FHA Approved
The Feds changed the game.
You now need to be HUD and FHA approved before your condominium community can provide FHA loans for your buyers. Once your complex is approved you have to be re-certified every 2 years.
If your condo community is not HUD/FHA approved you're missing out on a lot of buyers.
For those who can't be eligible for a conventional loans the FHA loan program is the answer.
Based on DQ News in April 2011 - 33.4% from the purchase mortgages used in 20 from the largest metro areas were FHA-Insured and also the November 2010 Realtors® Confidence Index reported that Nationally 39 percent of latest buyers purchased a home with FHA-insured loans.
In case your condominium community is not FHA approved you're passing up on lots of potential buyers. This will also affect current homeowners when they go to sell their unit.
For a lot of very first time house buyers qualifying for a conventional loan isn't possible. With the FHA you will find programs that make it feasible for these people to get affordable financing.
The Benefits of the FHA Loan Program
- A minimal down payment
The FHA program lets buyers put as little as 3.5% of the purchase price down. Understandably this opens many doors for individuals that wouldn't otherwise be able to think of a conventional down payment.
- Assist with closing costs
Qualified applicants may also receive up to 6% towards settlement costs. This cuts down on the loan and down payment amount.
- Co-Signer requirements
Another area of the program allows for a blood in accordance with co-sign. Why is this program different is when the home-buyers do not have sufficient credit to qualify by themselves a blood relative can co-sign without needing to reside in the house that's being purchased.
With the aid of those benefits people with little credit, low and moderate incomes and first time house buyers convey more opportunities to find affordable housing.
These types of people constitute a large part of these buying homes. Very first time home buyers are usually the ones that are less qualified for conventional loans. Without being HUD approved your condo community will not be able to provide affordable financing in the FHA.
Recently HUD made drastic changes for their condo approval program. These changes jeopardize the availability of FHA loans for condominiums.
HUD Changes:
- Elimination of spot approvals
- Mandatory re-certification for projects approved prior to October 2009
- Re-certification every 2 years
The removal of spot approval may cause major concern and problems for your condominium community. Spot approvals gave every condo community a way to assist people requiring FHA programs. Loans were selected an as needed basis.
If you were relying on spot approvals to acquire financing for all those homebuyers that require FHA assistance that choice is no more available. You won't be capable of getting FHA help to buy a home within your community.
Now full HUD approval is required for anybody wanting to use the FHA loan program.
In case your condominiums have to be certified or re-certified now is the time to do it. It's anticipated that there is a boatload of applications to HUD for FHA approval over the next couple of months so get yours in now. First come - first served.
