The Federal Housing Administration (FHA) Condominium Project Guidelines were recently revised in various respects. One significant change takes account of the financial difficulties that condominium associations and their owners have been facing over the past several years. The previous guidelines stated that associations would not be approved if more than 15% of units were more than 30 days delinquent. Under the new guidelines, condominium associations that exceed that 15% threshold can still qualify for FHA approval if they:
1) Have no more 20% of units that are more than 30 days delinquent;
2) Provide a report showing the past 6 months of assessments charged and collected;
3) Provide a report showing current reserve fund balances and operating accounts that exceed the amount of outstanding delinquencies;
4) Provide a showing that the association has budgeted for delinquencies;
5) Provide a reserve study less than 24 months old demonstrating that the association can meet replacement needs; and
6) Provide evidence of collection efforts, including legal actions and payment plans.
If your association is interested in obtaining FHA approval, it should contact an experienced professional that works in that area to determine whether it meets the many criteria that are involved in that process.
1) Have no more 20% of units that are more than 30 days delinquent;
2) Provide a report showing the past 6 months of assessments charged and collected;
3) Provide a report showing current reserve fund balances and operating accounts that exceed the amount of outstanding delinquencies;
4) Provide a showing that the association has budgeted for delinquencies;
5) Provide a reserve study less than 24 months old demonstrating that the association can meet replacement needs; and
6) Provide evidence of collection efforts, including legal actions and payment plans.
If your association is interested in obtaining FHA approval, it should contact an experienced professional that works in that area to determine whether it meets the many criteria that are involved in that process.
