In December of 2010, the FHA changed the way that their approval process worked, and as of that date, all condominium approvals either expired or were set to expire within a specific time frame. The FHA approval for Kenthill Townhomes was set to expire on May 31, 2011. As you know, having an FHA approval is very important to the marketability of each individual Unit in our condominium complex, and therefore extremely important to value. Because of all the recent changes made in the lending field, FHA financing is currently being used on close to 40% of all purchase transactions. Without FHA approval, owners at Kenthill Townhomes limit the marketability of their Units and thus decrease the value of all the Units in the condominium complex. Furthermore, in addition to the above mentioned change, individual approvals for a specific owner Units (often referred to as, “spot” approvals) in a condominium complex are no longer available from the FHA. In other words, an individual owner can no longer obtain FHA approval for just their individual Unit. In conclusion, it became imperative for the Board to renew Kenthill Townhome’s FHA approval before it expired. After extensive research, the Board was able to acquire assistance with this endeavor at considerable cost savings. It should be noted that current guidelines now require application for recertification every two years. Part of the purpose of this rule is to ensure that condominium complexes have a low delinquency rate as well as a low “owner-occupied” to “rental/tenant” ratio. More information about this topic will be provided in the coming weeks and months. Please scroll down and review the May 14, 2011 and June 12, 2011 posts on this website for additional links and photos concerning not only FHA approval but also VA approval.
Note to real estate agents who may read this: All parties and any current listings should revise their MLS to include both the FHA and VA approval notice since it may increase the buyer prospects immediately.
