I received an email from a FHA consultant today summarizing most of what we have been hearing about new FHA approval guidelines. I wanted to offer it out to those who are in an association and/or Developers and needing a quick update…. This is from JaeMac Approved!Consulting
Ok, so Fha is Notice on FHA Condominium Processing:
Mortgagee Letter 2009-19 provided guidance on the new approval process for Condominium Projects, allowing lenders to determine project eligibility, review project documentation, and certify to compliance of Section 203(b) of the National Housing Act and 24 CFR 203 of HUD’s regulations. This new approval process was effective for all case numbers assigned on or after October 1, 2009. However, the new effective date is for case numbers assigned on or after November 2, 2009.
WHAT DOES THIS MEAN TO YOU?
1. The 30% concentration cap for HUD insured mortgages in one building has been delayed (for right now)
2. Developers renting more than 10% of unsold units will not be considered an entity (for right now)
3. 2 and 3 units condo buildings cannot be FHA approved (for right now)
4. First right of refusal still needs to eliminated in condominium declarations (for right now)
5. New construction condominium buildings existing less than one year still needs a 10 year warranty (for right now)