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HUD/FHA Approval For Condominium Complexes
It is important for Your Condominium Community to become 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 to your buyers. Once your complex qualifies you have to be re-certified every 2 years.
In case your condo community is not HUD/FHA approved you are passing up on a lot of buyers.
For people 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% of the purchase mortgages utilized 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 isn't FHA approved you're missing out on a lot of potential customers. This can also affect current homeowners when they visit sell their unit.
For many very first time home buyers qualifying for any conventional loan isn't possible. Through the FHA there are programs that make it practical for these folks to get affordable financing.
The advantages of the FHA Loan Program
- A low down payment
The FHA program lets buyers put less than 3.5% from the purchase price down. As you can imagine this opens many doors for people that wouldn't otherwise be in a position to come up with a conventional down payment.
- Help with settlement costs
Qualified applicants may also receive up to 6% towards settlement costs. This cuts down on the loan and deposit amount.
- Co-Signer requirements
Another part of the program allows for a blood relative to co-sign. Why is this program different is when the home-buyers don't have enough credit to qualify on their own a blood relative can co-sign without needing to live in the house that is being purchased.
With the aid of those benefits individuals with little credit, low and moderate incomes and very first time home buyers have more possibilities to find affordable housing.
These kinds of people constitute most of those buying homes. First time home buyers are often the ones that are less qualified for conventional loans. Without being HUD approved your condo community will not be able to supply affordable financing in the FHA.
Recently HUD made drastic changes to their condo approval program. These changes jeopardize the availability of FHA loans for condominiums.
HUD Changes:
- Removal of spot approvals
- Mandatory re-certification for projects approved prior to October 2009
- Re-certification every 24 months
The elimination of spot approval can 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 decided on an when needed basis.
Should you be counting on spot approvals to obtain financing for all those homebuyers that need FHA assistance that choice is no longer available. You will not be able to get FHA assistance to buy a home in your community.
Now full HUD approval is required for anyone wanting to use the FHA loan program.
In case your condominiums need to be certified or re-certified now is the time to get it done. It's anticipated that there is a boatload of applications to HUD for FHA approval within the next couple of months consider getting yours in now. First come - first served.
