What Changes Has HUD Made?

Did you know that last year there were major changes made by HUD to the FHA loan programs for condominium approval?  The changes were made regarding the certification requirements.  If you don’t know about them then your condominium community could have already fallen off the HUD approved list and could be losing out on many potential homebuyers in your area. 

Changes made by HUD will affect everyone; homeowners, buyers and the community itself. 

What are the Changes to the FHA Programs?

The changes regarding certification are drastic.  The biggest change is probably the dismissal of spot approvals.  Spot approvals were determined on an as needed basis without the condominium community having full blown HUD approval.  This made things easier on the condo community.  Now spot approvals will not take place.  If the community is not HUD approved then homebuyers with FHA financing simply won’t be able to look at that housing and therefore, there will be no condominium approval and no sale. 

If you consider how many homeowners and potential homeowners qualify for FHA financing you will know that if you are not HUD approved you will be missing out on a large chunk of potential buyers.  Future buyers that qualify for FHA financing for a number of reasons make up a large portion of those seeking to buy real estate. 

HUD also ordered a mandatory recertification in 2010.  Anyone that had been approved prior to October 2008 had to recertify or risk falling off the approved list.  Trust us, letting your certification lapse is not something you want to let happen.  That’s where we come in.  We are Mortgage Professionals with the experience to help condo communities get HUD approved. 

Another change is that HUD now requires recertification every two years.  Depending on demand there can be a lengthy wait to get your recertification package processed.  We can help you plan ahead to ensure that your certification doesn’t lapse.  That could cause a lot of problems for your community. 

The Changes Affect Everyone

Potential Buyers:
Potential buyers feel the effects when they choose a property to look at and then find out their financing won’t allow them to purchase that home.

Current Homeowners:
With fewer eligible buyers market values may decrease and homeowners drop asking prices to try to appeal to more buyers who can get condominium approval loans.  This in turn affects the entire community.

Condo Community:
When current homeowners are unhappy and unable to sell this affects current market value which affects the entire community. 
Don’t let this happen to your condominium community.  We can help you before you start to feel the effects these condominium approval changes could have on you. 

What is an FHA loan?

An FHA loan isn’t exactly a loan.  The Federal Housing Administration (FHA) doesn’t actually lend any money.  Instead what their program makes possible is to insure loans made by other lenders.  Those people that would not normally qualify for a home loan have a better chance at being approved for a FHA program. 
These programs help individuals and projects get funding they can afford just maybe don’t meet traditional underwriting requirements.  They may not have a large enough down payment or fall into the low or middle class income level.  This program has been in place since the 1930’s and has helped countless numbers of people with the ability to buy a home. 

There are many other benefits for the people that qualify for this type of financial assistance.  They may receive assistance with closing costs and qualify for a smaller down payment with the condominium approval process. 

Those that qualify could spend as little as 3.5% of the purchase price for the down payment.  With assistance like that many more people will be able to afford to purchase a home.  Many people can afford the payment but aren’t able to save up for a larger down payment.  This creates many more opportunities for people that otherwise wouldn’t have the benefit of owning their own home.   
 
Another financial benefit of the program for potential home buyers is that they can receive up to 6% towards closing costs.  This is just another benefit that helps those that qualify for the programs enjoy more perks of buying a home. 

Don’t delay in getting your condominium approval HUD certified.  Think of all the opportunities that will mean for current home owners and your property.  Part of the American dream is home ownership.  Being part of this program allows more options for those looking to benefit from purchasing a home.