CAI Files Comments on Proposed Regulations to Encourage a Process that Allows More Condominiums to Qualify for FHA Certification
The following update comes from Dawn Bauman at CAI’s Government Affairs Blog:
There are approximately 145,000 to 155,000 condominium projects in the U.S., according to the Foundation for Community Association Research (FCAR). As of October 2016, 9,866 condominiums—less than 7 percent of condominium projects nationwide—were Federal Housing Administration (FHA) certified. If a condominium project is FHA certified, that means prospective buyers interested in individual units within a condominium may qualify for an FHA insured mortgage. FHA insured loans are a type of federal assistance and have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford.
The U.S. Department of Housing and Urban Development (HUD) released a new proposed rule to implement HUD’s authority under the National Housing Act to set the basic standards condominium projects must meet to be approved as condominiums in which individual units would be eligible for FHA insured mortgages. The rule provides a method by which certain approval standards could be varied efficiently to meet market needs while providing for public comment where appropriate. Currently, single-family condominium project approval is provided under HUD’s Condominium Project Approval and Processing Guide and related Mortgagee Letters.
CAI reviewed and analyzed the proposed rule with a team of subject matter experts; including community association attorneys, managers and condominium project approval consultants. On behalf of CAI members, the team, led by CAI’s federal advocate, Scott Canady of Tambala Strategies, composed a comment letter to represent the interests of CAI member condominiums to ensure appropriate access to FHA insured mortgages in condominium projects. CAI expects the final rule to be released in the middle of 2017. CAI’s comment letter can be found here.