The Department of Housing and Urban Development has issued new guidance on its policies for approving and recertifying condominium projects that are eligible for Federal Housing Administration financing.
HUD also consolidated all of its condo guidelines into a new 95-page booklet for easy reference.
"This guidance formalizes and expands the policies we put in place in 2009 and lays the groundwork for a more formal rulemaking process going forward," said FHA acting commissioner Robert Ryan.
The new guidance gives the FHA Homeownership Centers more flexibility in making exceptions to owner-occupancy requirements and other rules.
But FHA has not made the guidelines more flexible, according to one source.
He noted that FHA tightened its rules on delinquent homeowners' assessments to include all units -- even foreclosed properties owned by banks. Some banks don't pay homeowners' assessments on REO.
If 15% of units are 30-days or more behind on the assessments, the condo won’t qualify for FHA-insured financing.
HUD consolidated all of FHA's condo guidelines into a new 95-page booklet for easy reference.
