HUD sets FHA requirements for condo financing
The Department of Housing and Urban Development (HUD) released a mortgagee letter on October 26 outlining the requirements for FHA-insured financing for condominium buyers if a development has an owner-occupancy ratio as low as 35 percent.
For FHA (Federal Housing Administration) funding to be approved, the letter says that the development must show it has “higher reserves, a low percentage of association dues in arrears, and evidence of long-term financial stability.”
This is great news for prospective condo buyers since in recent memory only a handful of condos have met the FHA requirements. Hopefully more and more condos will meet the requirement and obtain FHA approval.