Federal Housing Administration (FHA) Issues New Condominium Approval Rule

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New FHA guidelines will lead to increased eligibility of condo units that may be financed by credit-worthy borrowers. NJ Lenders Corp. embraces new guidelines as it makes it easier for individual condominium units to be eligible for FHA-insured financing

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The new FHA rule should substantially help eligible borrowers including first-time homebuyers, as well as seniors who may be looking to downsize.

Effective starting on October 15th, 2019, the Federal Housing Administration (FHA) has published a new condominium approval process to help credit-worthy first-time buyers attain affordable and sustainable homeownership. The new rule will now allow certain individual condominium units to obtain FHA mortgage insurance, even if the condo project is not FHA approved.

In the new Condominium Project Approval section of the Single Family Housing Policy Handbook, you can find the detailed revision and changes to the FHA condominium project approval policy. However, the main points of the FHA’s new rule include the following…

  • A new single-unit approval process will now make it easier for individual condominium units to be eligible for FHA-insured financing
  • The recertification requirement for approved condominium projects will now be extended from two to three years
  • More mixed-use projects will now be eligible for FHA insurance

The new FHA rule should substantially help eligible borrowers including first-time homebuyers, as well as seniors who may be looking to downsize. Based on this new policy, it is estimated that 20,000-60,000 condominium units could potentially become eligible for FHA-insured financing annually.

About NJ Lenders Corp
NJ Lenders is a leading regional mortgage lender, headquartered in Little Falls, New Jersey. We are licensed to make mortgage loans in NJ, NY, PA, MD, MA, VA, CT and FL. We are an FHA direct endorsed lender and proudly make loans which are insured by the FHA. This product line is designed to help low-moderate income families attain the dream of homeownership. Due to the relaxation of FHA guidelines, with respect to the purchase of condominium units, it is our belief this will allow more families to realize this dream. For more information please contact us at 973-890-0005.

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Steve Grossman
@NJLendersCorp
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