In accordance with the passage of the Housing and Economic Recovery Act of 2008 (HERA), the Federal Housing Administration (FHA) is implementing a new approval process for condominium projects and insurance requirements for mortgages on individual units, as authorized under Section 203(b) of the National Housing Act.
December 7, 2009 FHA will now allow lenders to determine project eligibility, review project documentation, and certify to compliance with Section 203(b) of the NHA and 24 CFR 203 of FHA’s regulations. FHA will continue to maintain a list of approved condominium projects.
Lenders will be required to retain all the project legal documents, contracts, conveyances, plats, plans, insurance coverage, presale and owner occupancy conditions and other documentation in connection with their review and approval of the condominium project..
The following documentation is required for Condo Project Approval:
To qualify for an FHA loan for a Condominium Project using Direct Endorsement Lender Review and Approval Process you will need a minimum credit score of 580.
HUD allows the lender to approve the Condominium Project.
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Condo not FHA Approved?
On January 20, 2010 FHA announced a policy change to address risk and strengthen finances. FHA changed the minimum credit scores for new borrowers:
Direct Endorsement Lender Review and Approval Process.
This option is only available to lenders who have unconditional Direct Endorsement authority and staff with knowledge and expertise in reviewing and approving condominium projects.
This means that if the Condo Project is not approved we can get the Condo Project approved.
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