December 24, 2012

Does Your Condominium Association's Leasing Restriction Meet FHA's Guidelines?

Financing insured by the Federal Housing Administration (FHA) offers favorable terms and represents the bulk of loans currently available to prospective homeowners.  Many condominium associations are therefore seeking FHA approval.  However, that approval will not be forthcoming if their governing documents do not meet FHA’s standards. 

Among a number of other requirements, the FHA has specified guidelines for acceptable leasing restrictions in condominiums.  Three of those guidelines deserve special attention.  First, leasing restrictions must permit at least one unit to be leased.  Second, leasing restrictions may not require that a prospective tenant be approved by the condominium association or its agents.  Third, legal restrictions must not permit leasing for periods of less than thirty days. 

Condominium boards should consider giving themselves the gift of quality legal representation this holiday season.  This will allow them to more effectively promote peace and prosperity in their communities during the year to come.