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Update Of Fha-eligibility Requirements For Condominiums

If your Association contains single-family attached housing, then the Association is required to be approved by the FHA as an eligible property in order for buyers to have an FHA-loan. Otherwise, units may only be financed with conventional loans. One of the requirements for FHA Eligibility is that 50% of the units must be owner occupied. If your Association is mainly investor-owned, this will be an issue for those trying to obtain financing for an FHA-loan.

However, the Federal Housing Admin-istration (FHA) recently announced a temporary reprieve for Associations on this issue. The FHA is allowing Associations to circumvent the requirement provided that:

1) the ownership votes to amend the Declaration to allow leasing for bank-owned units; or

2) the Association’s Board provides a signed, dated letter on Association letterhead stating that there are no leases that have a term of less than 30 days AND there are no hotel-like services provided.

More on Community Associations

The Attorneys at Ott & Associates Co., LPA, frequently write and publish legal articles in order to educate clients on continuously changing laws in each practice area.

As your legal counsel, we become part of your team, providing the legal component to your business decisions.

Let us get started today.

216-771-2600

Ott & Associates Co., LPA

1300 E 9th St, Suite 1520
Cleveland, OH 44114

Ph: 216-771-2600
Fx: 216-830-8939

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