Be wary of Condos new rules coming November 2, 2009
October 19th, 2009 | 
Author: Be aware as you begin looking for your new condo that there are new rules that could potentially hurt you if your looking for a FHA loan. FHA will put into place new rules that will limit borrowers ability to obtain FHA financing on a condo.
Specifically,
– Only 30% of all units in a development can be FHA Loans
– The development will need to be approved by FHA. Prior to this change FHA would allow
spot approvals on individual loans.
– The development will need to be at least 50% sold.
– The condo association will need to pay for a reserve study on an annual basis at a cost of
$3,000 to $5,000. Many associations only preform this every couple of years.
– FHA will not insure a loan if more that 15% of the members are deliquent on their dues. I am
unclear if this includes units that are REO or in Pre Foreclosure.
These changes will have a dramatic effect on potential buyers but also sellers as FHA loans are todays primary funding source for First Time Homebuyers.
Posted in FHA, FHA Loans, Homebuyer Tax Credit, Local News, mortgage, mortgage loan | 
Tags: FHA, FHA Loans, Homebuyer Tax Credit, Mortgage Loans