The government has recently made certain changes to FHA lending that will make it easier for people to buy condos in certain communities, and I’d like to discuss some of those changes today.
Here’s how it works:
Every condo association is either approved or not approved to be purchased by FHA lending. FHA lending is basically government-backed lending which allows an eligible person to put 3.5% down in order to move into a property. Right now, the condo community has to be approved by the FHA in order for a person who has FHA financing to be eligible to purchase in that community.
While the FHA laws have been strict in the past, they have been loosened up as of late July. Here are a few of the things that FHA has changed:
They’ve streamlined their entire certification process for a condo project to be approved for financing, which will make it a bit easier for people with FHA financing to be able to purchase in that community.
They have also reduced the minimum number of non-owner-occupant units in the community. What this means is that if, for example, 50% of the community is owned by investors, the FHA would not have normally lent in there, but now if only 35% of the units are owner-occupied, FHA financing would still be allowed in that community.
These changes make everything a little bit easier. If you rewind about 10 years, the real estate community became very competitive when the government employed some changes to make it easier for people to qualify for and purchase properties, and this is the situation we’re looking at once again 10 years later.
If you’re an FHA buyer with questions about how this works, or if you’re a seller wondering how all of this will impact the condo you’re trying to sell, feel free to contact us by phone or email at any time. We look forward to helping you.