Blog post by David Swedelson, Condo lawyer, HOA Attorney and Senior Partner at SwedelsonGottlieb, Community Association Attorneys
We receive a lot of inquiries regarding FHA loans. Many condominium association boards have not sought or obtained approval from the FHA as a result of objections to the agency’s strict criteria. Many California condo associations have found that the requirements to difficult to comply with. Things could be changing. Recent news articles state that “the Federal Housing Administration is readying changes to its controversial condominium rules that have rendered large numbers of units ineligible for the agency’s low-down-payment insured mortgages.”
“The revisions could remove at least some of the obstacles that have dissuaded condominium homeowner association boards from seeking FHA approval or recertification of their buildings for FHA loans in the last 18 months. Under the agency’s regulations, individual condo units in a building cannot be sold to buyers using FHA-insured mortgages unless the property as a whole has been approved for financing.”
“FHA officials defend their requirements as prudent and necessary to avoid insurance fund losses but have expressed a willingness to reconsider some of the issues that have upset condo owners and the real estate industry.”
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