We have been waiting on this mortgagee letter for over a year and it is finally here! We can now do Site Condos effective immediately without having to meet the Spot Approval process for FHA. Very exciting news indeed. Please take the time to read the mortgagee letter as it answers any questions you may have regarding this new process.
HUD Publishes Condominium Letter: ML 2009-19
HUD has published Mortgagee Letter 2009-19 implementing new condominium rules pursuant to the law enacted last July. Lenders will have two condominium approval options. They are: 1) HUD Review and 2) Direct Endorsement Lender Review. (Environmental reviews will not be required on projects processed by Direct Endorsement lenders). Permitting Direct Endorsement lenders to process condominium project approvals should greatly enhance the use of FHA financing for condominium projects when this proposal is fully implemented in October 2009.
Other important changes include: not requiring project approval for "site" condominiums; allowing projects that have as few as 2 units; termination of the "spot loan" process; imposing a limit that no more than 30% of the units in any project have FHA insurance; allowing manufactured housing condominiums.
The guidelines take effect for case number assigned on or after October 1st with the following exception.
*Site condominium changes are effective immediately
If you're looking for an easier way to buy a home, you've come to the right place! As your local mortgage adviser, I will review your needs & suggest financing options to meet them. NMLS # 130817
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