FHA Condo Approvals – Philadelphia Training Day 1
Today was the first day of a two-day training administered by HUD regarding the FHA condo approval process and its recently released Guide. I have been excited about this training since it was announced last month.
This is the first training provided by HUD on this topic for people who work outside of HUD. The Philadelphia training is their fourth and final destination of their “World Tour”, which began in Denver, CO. The other two stops included the other two Homeownership Centers, Santa Ana, CA and Atlanta, GA.
The facilitators of the training are those who wrote the Guide. The ability to ask questions to the very individuals who developed the guidelines is absolutely invaluable!
Among a litany of other outstanding information, which I will talk about in future articles, the mention of the number of approved projects nationally was striking.
HUD was in the process of making changes to their condominium approval process and system beginning in June 2008. At that time, they were importing projects from the old system to the new system. Roughly, 45,000 condominium projects were transferred to the new system. Some 8,000 approved projects were not imported to the new system because HUD did not have enough information on the projects to justify their importation.
By June 2011, around 10,000 projects had seen their approvals expire on 12/31/2010, 3/31/2011 and 5/31/2011. As of the end of June 2011, only around 800 got recertified.
Overall, 25,000 projects were facing the expiration of their approvals by the end of 2011. In total, only around 1,000 projects have been recertified as of the end of last month. According to HUD's estimation, the approved condominium list will have roughly 12,000-15,000 approved projects nationally, which is a dramatic drop from the 53,000 that it had prior to the changes.
One of the training facilitators attributed this to the fact that many projects are not financially viable at present so they have made no attempt to apply for a recertification. Another attributed it to the fact that Homeowner’s Associations simply don’t know that they have lost their approvals until a unit owner attempts to sell his/her unit or refinance with an FHA loan.
Furthermore, let’s consider a city in my state of Connecticut: Manchester. In 2010, Manchester had 41 HUD-approved condominium projects. Today, there are only 3: Greenview Hill, Hampton Run and Northfield Green. Granted, other projects may have begun the recertification process. I know that I am working on four project approvals in Manchester, all of which I fully anticipate being added to the approved condos list.
But, here is the point: if a buyer has been qualified for an FHA or CHFA loan and wishes to purchase a condominium in Manchester, he or she will only have three condo projects from which to choose!
Does that make those three projects more marketable? You bet it does. Sellers in those projects have access to a greater number of buyers which certainly aids in being able to sell their units, and for a better price.
If you live in a condominium project that is not currently approved with HUD, it needs to be. I have written articles on the need for HUD-approval. In this recessed housing market, HUD-approval is essential to the marketability of your condominium.
The Condominium Project Approval Team at ReadySetLoan is dedicated to helping condominium projects across the nation to obtain their approvals with FHA and the VA or become recertified with FHA. We have assisted nearly 200 condominiums and we can help your association.
ReadySetLoan is an active member of the Connecticut and New England chapters of the Community Associations Institute (CAI) and is a frequent contributor to Common Interest Magazine as an expert in FHA/VA condominium project approvals.
Please contact us with any questions regarding FHA or VA condominium project approvals. You can email me at firstname.lastname@example.org or call me at 404-433-4565. I will be happy to answer any of your questions.
FHA/VA Condo Approval Specialist
404-433-4565 Cell Phone
860-644-3772 Fax Phone
Check out our article in Common Interest magazine on page 19!