FHA Condo Approval Kentucky
The Federal Housing Administration has finally issued a long-awaited update to its condominium rules, announcing Wednesday that it will now allow individual unit approval and is taking other steps to loosen requirements that make these properties eligible for FHA financing. The agency said it expects the updated guidelines to qualify up to 60,000 more condo units a year for financing.
Under the revised guidelines – which take effect Oct. 15, 2019 – an individual condo unit in a building of 10 units or more may be eligible for spot approval if no more than 10% of the units are FHA-insured. For units in buildings with fewer than 10 units, no more than two units can have FHA insurance.
The FHA is also extending the recertification deadline for approved condo projects from two to three years, and it will insure more mixed-use projects, or those with more commercial space, to be eligible, stating that approved projects can now have up to 35% of their square footage dedicated to non-residential use.
The agency also loosened restrictions on owner-occupancy rules, stating that eligible condo projects can now be just 50% owner-occupied.
It also said it will insure up to 50% of units in any given project.
The FHA said it expects the updated guidelines to qualify an estimated 20,000 to 60,000 more condo units per year for financing.
Currently, of the more than 150,000 condo projects across the country, only 6.5% are approved for FHA financing.
This is something the FHA is aiming to change with the updated guidelines, Department of Housing and Urban Development Secretary Ben Carson said on a call with reporters Wednesday.