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HUD Changes for Condo FHA Buyers

HUD Changes for Condo FHA Buyers

moneyhouse

Did you hear about the upcoming changes from HUD in regards to approval for FHA financing on condos?  They were announced this summer, but their effective date is now less than a month away. Here are some of the noteworthy provisions below, as well as a link to the webpage with a link to the official HUD letter – “Mortgage Letter 2009-19”.   I hope this info is helpful.  At the very least, it’s good to be informed, right?

FYI – the original effective date was 10/1/09, but it was extended to 11/2/09.

Effective 11/2/09 …

  • HUD will completely wipe out their list of approved condo projects with the EXCEPTION of any condos approved on or after 9/1/08.

  • HUD will no longer accept Spot Condo Approval.

  • HUD condo approvals will be approved for a 2 year period.  Every two years it must be re-approved.

  • Condo projects will be limited to 30% FHA exposure.  Not more than 30% of the entire project can have FHA financing. (In condo projects of 3 or less units, not more than one unit.)

  • Land/Home will have a 30 day moratorium on HUD Condos.  Only FHA loans done for condos will be those that are already on the approved list or FHA case numbers ordered prior to 11/2/09.

*Exceptions: FHA to FHA Streamline loan, and FHA/HUD REO Division Sales

http://www.hud..gov/offices/hsg/sfh/hsgsingle.cfm

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