December 4, 2012
There are plenty of options for those seeking FHA home loans who don’t want a home in the suburbs. Some want a condo unit, and while these types of loans can be a bit more complex due to certain requirements (FHA loan rules require condos to be on or added to a list of FHA approved projects) these types of loans are definitely available to qualified FHA loan applicants.
Lenders prepare borrowers for the additional steps required in the condo loan process. What the borrower should not expect? Discrimination of any kind in that process. According to a recent press release on the HUD official site, “The U.S. Department of Housing and Urban Development (HUD) announced today that it is charging the homeowner association and property managers for an Edina, MN, condominium building with housing discrimination. HUD claims that they refused to allow children under the age of 18 to live at the property.”
We report these stories when they occur because it’s too easy to assume that age-restrictive condo association policies like the ones mentioned in the FHA/HUD press release are legitimate and not in violation of the Fair Housing Act. This is not true except under very specific parameters described in the HUD press release. Age discrimination is not tolerated, and properties with age-specific restrictions must be in compliance with federal guidelines for those restrictions (associated with housing for older persons). Discrimination against families with children (or those about to have children) is not permitted.
According to that release, HUD alleges “7000 Sandell Condominium Association, Inc., its property management company, New Concepts Management Group, Inc., and the property’s off-site manager, Paul L. Bonzonie, violated the Fair Housing Act when they maintained a policy prohibiting children who are minors from living in the building, even though the property did not meet the federal qualifications to be housing for older persons. The Fair Housing Act prohibits housing providers, including condominium associations, from denying housing to families with children under the age of 18, unless the housing meets the federal standards to be housing for older persons.”
“Denying a family’s right to have their children live in their home is against the law,” said HUD’s Region V Administrator Antonio R. Riley. “HUD is committed to taking action against housing providers who unlawfully deny housing to families because they have children.”
The specifics of the case include, according to HUD, allegations that “the condominium association and its property managers discriminated against the owners of a unit in the building when they notified the owners that they were violating the association’s Declaration for Condominium by allowing their minor children to live with them for more than 30 days in a calendar year, levied fines against the owners, and initiated a lawsuit in Minnesota state court in an effort to keep the owners’ children from living with them. HUD’s charge further alleges that the condominium association failed to meet the federal requirements to qualify as housing for older persons because the association failed to formally and routinely verify the ages of the complex’s residents.”
Borrowers are often the first line of defense against this sort of discrimination. If you encounter violations of Fair Housing laws at any stage in the FHA loan process, report it immediately. The FHA press release concludes by stating, “People who believe they are victims of housing discrimination should contact HUD at 1-800-669-9777 (voice) or 1-800-927-9275 (TTY).”
Do you have questions about the FHA loan process? Ask us in the comments section.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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