FHA Condo Approval Specialist: FHA Site Condominiums – Can the Association Mow the Front Yards?

FHA Site Condominiums – Can the Association Mow the Front Yards?

FHA Site Condominiums – Can the Association Mow the Front Yards?

fha site condosI typically write 3-4 articles per week about FHA and VA condo project approvals.  By far, the most common inquiries that I receive are about what qualifies a project as a site condo in the eyes of FHA.  I received such a call from an attorney in Irvine, CA, just yesterday.

The attorney called after reading my blog about site condos.  He said that he is working with a developer to assist in writing the legal governing documents.  The desire is to develop the condominium such that it meets the requirements to be deemed a site condo project and not need to go through the FHA approval process.

From the conversation, it was determined that the project would meet the site condo requirements: all units are detached; the unit owner is responsible for the interior and exterior of the structure and the land; and the unit owner is responsible for the insurance of the structure and the parcel of land.

However, the developer would like to make it mandatory that the front yards be maintained by the association, and not the unit owners.  I didn’t ask why but I would assume so that there was a consistent and uniform curbside appearance.  This would obviously improve the aesthetic value of the neighborhood.

I told the attorney that this would not fly with FHA.  At its most fundamental level, a site condominium project must have the “look and feel” of a neighborhood of single-family detached homes but be under a declaration of condominium.  In such a neighborhood devoid of an association, the home owners would be responsible for the care of the front yards.

Furthermore, the unit owner in a site condo must be responsible for everything within the boundaries of the unit, which includes the land.  The association cannot be responsible for the maintenance or insurance of anything within the unit boundaries.

The attorney agreed and said that he had received this information and wanted to verify it before proceeding with the drafting of the documents.

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.

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

eric.boucher@readysetloan.com
ready set loan condo team

 

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Comment balloon 15 commentsReadySetLoan Condo Approval Team • June 26 2014 06:09AM

Comments

This little detail point in the post is why professionals are needed. Who would know this?

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) over 4 years ago

Eric~ you prove time and time again the importance of "you" AWESOME information, thank you

Posted by Jon Kolsky, Licensed California Real Estate Broker (Kolsky Realty & Management) over 4 years ago

Layers of rules, regulations, bylaws and the penalties if the lawn police issue the citation. Your third and final warning for the grass being too high. The garage doors left open too often. Clothes hung on a line out back and pick ups, service trucks in the front yard. Heads are gonna roll and you'll be hearing from my attorney. Saber rattling from legal beagles. Not like that in small rural markets.

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) over 4 years ago

Eric, useful information, we have so few detached associations in our area but if the question arises, I just might remember the answer

Posted by Ed Silva, Central CT Real Estate Broker Serving all equally (RE/MAX Professionals, CT 203-206-0754 ) over 4 years ago

Eric:  Love your posts ... I always find some bit of new info ... or confirmation of info I already know.  Each definitely serves a great purpose for me ...

Congrats on a well-deserved Feature ...

Gene

Posted by Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi, 708.921.6331 - 40+ yrs experience (NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656) over 4 years ago

If it's covered in the condo/assn docs, that the way it will be.

 

Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate) over 4 years ago

Great information in here, Eric.  Condos are tricky so it's great that you can provide your borrowers with such a wealth of information.

Posted by Rachel Khoury, Your Wingwoman for Colorado Mortgages (Tailwinds Mortgage) over 4 years ago

Hi Richie - I would think that only we weirdos who have focused on this topic would know this information!

Thank you Jon. Glad the information was valuable to you.

There are definitely many added layers when living in a condominium, Andrew

Ed - this is definitely not very common here in CT

Thank you Gene  I'm pleased that you get something out of the articles!

Lenn - that is absolutely correct.  However, if the goal is to avoid the need to obtain an FHA project approval, the unit owner must be responsible for the lawn.

Thank you Rachel  Condos are tricky and the rules between FHA, the VA and Fannie Mae are similar but all have their own nuances.

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

Eric I love site condo's like 55+ detached units.  The financing is easy because they are treated like single homes and the HOA fees are usually low so they do not play havoc with my DTI's.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) over 4 years ago

Eric

The association can do what's in the docs . . . . thanks for sharing the information.

Good luck and success.

Lou Ludwig

Posted by Lou Ludwig, Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC (Ludwig & Associates) over 4 years ago

Eric thanks for this information.  It is most helpful.  I was just wondering what is a  "site condo"?

Posted by Joan Whitebook, Consumer Focused Real Estate Services (BHG The Masiello Group) over 4 years ago

I would just hope they would do a good job at the end of the day. :

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) over 4 years ago

Good morning Eric. I lend in two projects that are individual units, so far have not any difficulty getting mortgages done, both FHA and VA.

Excellent information as usual.

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

I am confused Eric.  The land outside of the unit is usually common land and not owned by the individual unit.  Wouldn't this be the responsibility of the Association?

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

No question about it George.  There are no extra hoops to jump through in these cases.

Exactly, Lou, but the docs must have specific language if they wish to qualify as "site condos".

Hi Joan - a "site condo" is a designation that FHA uses.  Site condos do not need FHA project approval for FHA loans to be available.  You can follow this link to read more about it.

Having nice lawns brings more aesthetic value to the community, Laura

Joe - detached condo communities are certainly easier to finance.

Conrad - it depends on what the legal documents say.  There is no requirement that the land be owned by the HOA or the unit owner so the developer is free to do whatever he/she wants so long as it is consistently applied to all units.

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

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