FHA To Change Up Condo Lending Requirements

The Federal Housing Administration indicated this week that it is in the process of evaluating changes to its condo lending requirements, according to a statement provided to Housing Wire. 

“While we are evaluating potential changes to our condo requirements and expect to announce some of those soon, we cannot yet comment on specific requirements that may be included in any potential changes,” a HUD spokesman told Housing Wire in a statement on Monday.

FHA’s condo requirements currently specify that there may not be any new loans in condo developments with more than 15% of the units being more than 30 days delinquent on condo association fees unless the building meets additional criteria. Another rule specifies that in order for FHA to insure a condo loan, more than half of the units in its building must be owner-occupied for buildings built a year ago, with a single investor not owning more than 10% of the units. 

Trade groups have urged FHA to reconsider its guidelines regarding condo units, especially in light of the economic downturn. The Community Associations Institute, the President of the Institute of Real Estate Management, National Association of Home Builders, and National Association of REALTORS® jointly wrote a letter to the U.S. Department of Housing and Development suggesting several “enhancements” to FHA’s condominium requirements last year. 

FHA has not indicated when it will make announcements regarding upcoming changes. 

Written by Elizabeth Ecker

Leave a Reply

Your email address will not be published. Required fields are marked *

Most Popular Articles

Latest Articles

The Gathering 2024 On Demand 

To truly experience the most powerful room in housing, reserve your spot now to join us at The Gathering 2025. However, if you want a glimpse into what that room looks like in action, we compiled a handful of our sessions from this year’s event to share on demand.

3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please