FHA Condo Approval Specialist: What is a VA Condominium Project Approval?

What is a VA Condominium Project Approval?

What is a VA Condominium Project Approval?

va condo approvalThe Department of Veterans Affairs (VA) maintains an Approved Condominiums List.  The purpose of the list is to track condominium projects that have met the VA’s set of minimum standards.  Without obtaining a VA condo project approval, VA loans are not available in the condominium project.

History of VA Condominium Approvals

For decades the VA has maintained an Approved Condominiums list for the purpose of determining the acceptability of condominium projects.  Once a condominium is on the VA approved condominiums list, its approval never expires.  The list of VA-approved condominiums can be found by clicking here.

Prior to 2009, the VA allowed its home loans in projects that were on the FHA and/or USDA approved condominiums lists.  If the condominium was on either list, that was good enough for the VA.  All that was required was to send a copy of the FHA or USDA approval to the VA and it would add the project to its approved condos list.

In 2009, following the release of HUD Mortgagee letter 09-46b, the VA discontinued using the FHA Approved Condos list as a basis for approval.  The VA felt that the new FHA guidelines and procedure for project approval did not line up with the VA’s criteria.  Now, the project must be approved with the VA before it will allow VA home loans to finance units within the project.

Criteria for VA Condo Approval

The most recent set of criteria for VA condo approvals is Chapter 16 of the VA Lender Handbook.  Sections of this Chapter have effective dates of 2001 and 2003.  The VA is currently in the process of revamping the guidelines and the Handbook as it pertains to condominiums.

The basic criteria for obtaining a VA condo approval are fairly similar to those of FHA and Fannie Mae with certain nuances.  The VA has far less tolerance for leasing restrictions than do FHA and Fannie.

However, the VA has a higher tolerance for investor concentration within a project – there is no ceiling.  FHA caps investor concentration to 50%.  Fannie Mae currently ignores investor concentration but only for primary and second home purchases.

va condo approvalThe VA also does not have a criterion for the maximum single-entity ownership.  FHA caps this at 50%; Fannie allows only 10% of the units to be owned by one single entity.

The VA verifies that 70% of the units in a project have conveyed to someone other than the developer before VA financing is allowed in a project.  Fannie Mae also has a 70% pre-sale requirement in most cases.  FHA’s pre-sale requirement is only 30%.

Processing of VA Condo Approval

The VA has a checklist of the required documents for approval.  It includes legal documents, proof of 70% pre-sale, financial information (including a breakdown of any special assessments), the minutes from the last two Board meetings, copies of current service contracts (landscapers, maintenance companies, etc) and description of current easements.

A paper file of the documents is sent to the jurisdictional Regional Loan Center for review.  An in-house Staff Appraiser is responsible for reviewing the file for acceptability.  Aside from that, the file is also sent to regional counsel where the legal documents are reviewed to verify that the project meets state and local laws.

Processing times can take 30-60 days and is highly dependent upon the workload of the regional counsel.  The VA says to allow up to 60 days for processing to be on the safe side.

One of the highlights of working with the VA is the accessibility of the Staff Appraisers.  I have never called the VA to speak with a Staff Appraiser and not been able to reach one.  They have all been very friendly and sound pleased to be answering questions.

For the remainder of the year, ReadySetLoan Condo Team LLC is offering free processing for VA condo approvals for all condominium clients who retain us for an FHA condo approval.  If you have questions about VA or FHA condo approvals, please contact us for a free consultation.


VA building photo credit: NCinDC via photopin cc

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 askeric@readysetloan.com 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

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 Check out our article in Common Interest magazine on page 19!

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Comment balloon 8 commentsReadySetLoan Condo Approval Team • June 18 2014 06:07AM


We really have so few VA loans in this area. When I do the monthly statistics there may be one or two closings in all of Bonita Springs and Estero.  

Posted by Chris Griffith, Bonita Springs Listing Agent (Downing-Frye Realty, Bonita Springs, FL) over 4 years ago

Good morning Eric. Outstanding information that all of us can use. We are all so fortunate that you keep us totally up to date on everything related to FHA and VA approvals.

Posted by Joe Petrowsky, Your Mortgage Consultant for Life (Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709) over 4 years ago

I haven't seen a VA loan on a condo in my area in years Eric.

Posted by Conrad Allen, Webster, Ma, Realtor (Re/Max Professional Associates) over 4 years ago

Hi Chris - VA loans are not as common in areas that aren't close to a base or reserve station.

Thank you Joe. I am pleased that the post provided value to you.

Conrad - I only did one in my 10 years as a loan officer.  They aren't very common but obtaining an approval is a great way for the association to show that Veterans are welcome in the community.

Posted by ReadySetLoan Condo Approval Team, The FHA/VA Condo Project Approval Specialists (ReadySetLoan Condo Team LLC) over 4 years ago

Eric, I'n glad to see you putting so much effort into VA approvals. We all benefit from the impact of easier financing. And the more choices a buyer has the more they will buy. And the more they buy, the higher prices will go. And the higher prices go, the sooner home builders will get back into the game. And that will mean the economy is recovering.

Bill Roberts

Posted by Bill Roberts, "Baby Boomer" Retirement Planner (Brooks and Dunphy Real Estate) over 4 years ago

Hi Bill - for the past four years, I have concentrated on becoming an FHA condo approval specialist.  I have worked with VA condo approvals but admittedly, I have not dedicated the same energy as I have with FHA condo approvals.  While we are diligently working to get condos approved with FHA, we have placed a focus on getting our clients approved with the VA.  It is a benefit to the association and a great benefit to those who have bravely served our nation.

Posted by ReadySetLoan Condo Approval Team, The FHA/VA Condo Project Approval Specialists (ReadySetLoan Condo Team LLC) over 4 years ago

Veterans thank you for looking into the niches of various loans that might work for them. Thanks for the information!

Posted by Paul Collier, Paul Collier (Patriot Home Mortgage) over 4 years ago

Hi Paul - we are making a push for our condo-clients to obtain a VA project approval as well.  That is a great way for condo communities to say "we welcome our soldiers and Veterans"

Posted by ReadySetLoan Condo Approval Team, The FHA/VA Condo Project Approval Specialists (ReadySetLoan Condo Team LLC) over 4 years ago