Check all CIC townhomes and condos here to make sure they are FHA HUD Approved //entp.hud.gov/idapp/html/condlook.cfm
Other factors not commonly known that will still be detrimental to successful financing with a condo even after we verify at the HUD condo lookup that the property is FHA approved.
- Commercial Space: No more than 25% of the property’s total floor area in a project can be used for commercial purposes
- Investor Ownership: Generally no more than 10% of the units may be owned by an investor. This also applies to developers/builders who subsequently rent vacant unsold units.
- Delinquent HOA Dues: No more than 15% of total units can be more than 30 days late in arrears of their association fee payments.
- Pre-Sales: At least 30% of the total units must be sold prior to endorsement of the mortgage in the case of new construction
- Owner Occupancy Ratios: At least 50% of the units must be owner occupied or sold to owners who intend to occupy the units. For proposed, under construction projects still in their initial marketing phase, FHA will allow a minimum owner occupancy amount equal to 50% of the number of presold units (the minimum presale requirements of 30% still applies)
- FHA Concentration: FHA may not insure more than 50% of a particular condo project. For projects consisting of 3-4 or fewer units FHA will insure 1 unit.
If these challenges are not researched prior to going under contract the lender will be alerted when they go to order a case number and HUD rejects the property address.