FHA Condo Changes

New changes related to condo requirements when seeking an FHA loans, listed below.  The changes are effective with FHA case numbers assigned on or after 12/7 and some of them are only temporary. 

* Pre-Sale Requirements: 30% minimum based on primary residence, second homes, and investment property transactions.
* Owner Occupancy Requirements: Minimum of 50% of units sold, or under contract, in the condominium project must be owner occupied by owner (or planned to be owner occupied).
* Multiple ownership: For projects with more than 10 units no more than 10% of the units may be owned by one entity or investor.
* Delinquent HOA dues: No more than 15% of the units can be more than 30 days past due.
* Maximum concentration of FHA loans: no maximum on existing projects if the below holds true.
* The project is 100 percent complete and construction has been completed for at least one year, as evidenced by issuance of the final or temporary/conditional certificate of occupancy for last unit conveyed;
* 100 percent of the units have been sold and no entity owns more than 10 percent of the units in the project (for projects with fewer than 10 units, single entity may own no more than 1 unit);
* The project’s budget provides for the funding of replacement reserves for capital expenditures and deferred maintenance in an account representing at least 10% of the budget;
* Control of the Homeowners Association has transferred to the owners