At one time, condominium developments that were FHA approved were approved for “life”. Thanks to the 2007 housing meltdown, that is no longer the case. In order to establish better oversight of all condo loans it insures, FHA forced all communities (who were approved before 2008) to get re-certified. And this new certification now comes with an expiration date. Just like it is with professional associations, condos will have to get re-certified every couple of years. Here are some of the requirements needed for FHA approval:
2. The number of owners who are delinquent in their condo fees cannot exceed a certain threshold.
3. There cannot be any pending litigation regarding safety or habitability.
4. No more than 30% of the units can be backed by the FHA financing.
5. Reserve funding for maintenance and repairs should equal about 10% of the operating budget.