Will FHA Finance A Condominium?

With the current problems in the mortgage industry, an FHA Mortgage could be a viable alternate for buyers today. Including buyers who would like to purchase a condominium. Most agents are aware of the fact that the FHA will finance a 1 to 4 family dwelling. Well, FHA will also finance a condominium. The condo must be located in an FHA approved condominium project or development. The lender must be an approved FHA lender, such as a mortgage company, bank, or savings and loan association. Any creditworthy potential buyer who meets FHA underwriting criteria and will make the condominium unit their principal residence is eligible.

Even if the condominium project or development is not approved by FHA, a single condo unit in that project or development may still be financed with an FHA mortgage. In order to be eligible for an FHA mortgage, the approved FHA lender must certify that the condominium project or development satisfies the eligibility criteria set forth by HUD. The lender may use a suggested HUD checklist to determine if the project meets the requirements. The lender must perform a sufficient investigation in order to answer all the checklist items. If the single condo unit meets the criteria, the single condo unit would be eligible for FHA financing as a "spot loan" consideration.

FHA Approved Condo Search: https://entp.hud.gov/idapp/html/condlook.cfm