Articles Tagged With: FHA Condo Loan

January 12, 2012

FHA Loans: Can I Change the Terms of Sale Agreement?

The FHA provides many helpful resources for homebuyers on its official site at FHA.gov. One of those resources is an online version of a HUD/RESPA booklet called “Buying Your Home” which includes a section on settlement costs. One of the first portions of this booklet a prospective FHA mortgage loan applicant will read includes the following: “The real estate broker probably will give you a preprinted form of agreement of sale. You may make changes or additions to the form agreement, but the seller must agree to every change you make. You should also agree with the seller on when you will move in and what appliances and personal property will be sold with the home.” The second sentence contains a revelation for some borrowers–some loan applicants simply assume that | more...

December 14, 2011

FHA Energy Efficient Mortgage Loans Part Two

By Joe Wallace

In a recent blog post we discussed the FHA Energy Efficient Mortgage Loan (EEM) and some of the basics of the program. The FHA EEM is for new purchase and refinancing mortgages and lets the borrower finance additional costs of energy-efficient upgrades or improvements to the home. Because the FHA loan program has loan limits and specific rules that govern those limits, it is easy to see how borrowers new to the FHA loan program could be confused by the terms of such a loan. After all, if a borrower can add at least $4,000 (or as much as $8,000 depending on the circumstances) to the FHA loan, how does one roll the costs of the improvements into the mortgage without exceeding the FHA loan limit for that purchase? According | more...

December 13, 2011

FHA and HUD Information In Spanish

By Joe Wallace

The FHA and HUD offer a wide range of information, advice, and news about FHA insured home loan programs. Part of that information includes FHA/HUD resources in Spanish. Did you know there’s an entire Spanish-language site dedicated to the same information provided in English? The Spanish language version of these pages is available at http://espanol.hud.gov/home.html and features information about buying vs. renting, home economics, FHA loan advice and other valuable resources. For those who have already purchased homes with an FHA mortgage, there are resources including topics on FHA/HUD refunds and “refund tracers,” refinancing options, foreclosure avoidance and other important details. When it comes to foreclosure avoidance advice, borrowers in trouble on their FHA loans in need of Spanish-language resources should see the page titled, “Gu

December 9, 2011

FHA Home Loan Resources By State

By Joe Wallace

Did you know that the FHA and HUD offer by-state listings of FHA-related news, programs, home loan resources and other information? While FHA home loans are available nationwide, there are many state and local programs designed to help home owners, FHA borrowers, veterans and others affected by such programs. For example, on the Alabama page at http://portal.hud.gov/hudportal/HUD?src=/states/alabama there is a press release detailing a Department of Housing and Urban Development grant to the State of Alabama to the tune of $120 thousand to fight housing discrimination and uphold fair housing initiatives. On the North Dakota page there are stories of the latest initiatives on the state and local level to assist low-income families. These state page on the FHA official site also contain valuable links to information for foreclosure avoidance, | more...

September 30, 2011

FHA Loans: Approved and Non-Approved Properties

By Joe Wallace

FHA loans for single family, new purchase properties have a set of requirements and regulations covering the types of homes that can be purchased with an FHA insured mortgage. Many people envision a traditional suburban home when thinking of buying property with an FHA mortgage, but FHA-approved condo projects, town homes, row houses, and even detached (or semi-detached) housing can be approved for an FHA loan if the property meets the right standards. Sometimes the phrase “single-family home” misleads a potential FHA borrower into thinking they can only purchase single unit properties. But according to the official site, “FHA’s single family programs are limited to one- to four-family properties that are owner-occupied principal residences. The key to being able to purchase a multi-unit property (capable of housing up to four | more...

September 21, 2011

FHA Condo Projects: Non-Residential Space

By Joe Wallace

FHA condo loans differ greatly in some respects from typical, single-dwelling properties that make up a large portion of the FHA insured mortgage loans. Condos are unique properties–the multiple individual owners residing in a shared building have different agreements, covenants and requirements for condo living than their suburban home-dwelling counterparts. But in some cases, rules for FHA condo loans resemble suburban home loans a great deal. For example, FHA loans allow a borrower to purchase a mixed-use property under a set of conditions which include the requirement that no more than 25% of the total floor space be used for non-residential or commercial purposes. When it comes to these mixed-use mortgages insured by the FHA,

September 21, 2011

FHA Loans and Condo Conversion Projects

By Joe Wallace

Some FHA loan applicants are surprised to learn that FHA loans are available for condominiums. A condo, by definition, is a building that offers titles for individual units within the common structure. The FHA has rules for condo loans, including a requirement that the condo be on a list of projects approved by the FHA. Some building owners decide to convert their property into condominiums so they can sell the individual units. The FHA will consider such conversion projects for approval provided the condo units meet FHA standards. Such standards include a “one unit, one residence” requirement; each unit must be a separate entity and must be sold and occupied as such. FHA loan applicants looking for condo projects often wonder if the FHA will insure condo units in a | more...

August 24, 2011

FHA Condo Loans and Conversion Projects

By Joe Wallace

FHA loans aren’t just for typical suburban homes–borrowers can apply for an FHA insured mortgage on many different types of properties, including condominium projects. It would be easy to assume that FHA loans are only for existing condo projects since FHA guidelines state all condo loans may be issued only on FHA-approved condos. But FHA loans may also be issued for condo conversion projects if they are approved and meet FHA requirements. One of the first hurdles for a condo conversion project to clear in order to be considered for an FHA insured condo loan is the definition of “conversion”. According to FHA rules, “Conversion to a condominium regime occurs in those projects which involve

July 27, 2011

FHA Condo Loans: Who Approves the Condos?

By Joe Wallace

FHA loan applicants looking for a condo loan have several options open to them when it comes to finding a project that is FHA-approved. The Department of Housing and Urban Development along with the FHA maintain a list of approved condo projects eligible for FHA loans, which is searchable by city, state, and other factors. You can find that list here: https://entp.hud.gov/idapp/html/condlook.cfm But is the existing list the only resource FHA borrowers have to find a condo project? What if the buyer finds a suitable condo that is not yet FHA approved? Thanks to the Housing and Economic Recovery Act (HERA) of 2008, changes have been made to the FHA condo project approval process, effective for all case numbers issued after December 7, 2009. According to the official site, “FHA | more...

July 20, 2011

FHA Requirements For Condo Units

By Joe Wallace

In our last blog post we discussed FHA rules on condo units that affect their eligibility for FHA mortgages. The FHA does not approve condo loans for any property that features deed restrictions which penalize the borrower for selling or transferring ownership of the condo to someone else. FHA regulations state that any property purchased with an FHA mortgage must be freely transferable without penalty. But those aren’t the only requirements on FHA condo loans. FHA rules include provisions for proper documentation (in conjunction with applicable state law) of homeowner’s agreements, and statements of understanding between condo owners about shared responsibility for property management. FHA borrowers new to condominium ownership might not know that the responsibilities of condo ownership include shared duties and costs such as facility maintenance, code compliance, | more...