Yesterday I commented on a blog that Donna Bigda wrote on Condominiums, and she suggested that I add a couple of links for Buyers to have as a resource.

The comment that I made was that most Condo Loans that I do are for First Time Homebuyer, and that FHA and Connecticut Housing Finance Authority (CHFA) are the two main loan programs that I use for them, because most First Time Homebuyers do not have much money to put down on a house or condo.  I also suggested that if a Realtor is working with a Buyer that will be using one of these two loan programs, that they need to make sure that the Condo Complex is on the Approved Condo List for FHA and/or CHFA. 

This is very important step in purchasing a Condo with either of these two loan programs, because if the Condo Complex is not on their approved list, you might not be able to do the loan.  I say might, because even if the Condo Complex is not on their approved lists, a "Spot Approval" may still be possible.  The main obstacle that I find with being able to do a "Spot Approval" is that many times a Condo is not on these approved lists, because they either do not meet the Investor to Owner Occupied Ratio required, or the Condo Association By-Laws contains a "Right of First Refusal Clause".  Both of these are like the kiss of death in obtaining a "Spot Approval" The Investor to Owner Occupied ratio that is required is 51%.  That is 51% or more of the units need to be occupied by owners.

If a Borrower is trying to do a CHFA Loan on a Condo, both CHFA and FHA Condo lists need to be checked, because CHFA is a FHA insured loan, so the Condo Complex needs to appear on both list.  This may seem like a simple process, and it is, but it is amazing how often no one checks these list, and then finds out after they make an offer that they have a problem. 

Below are the links for these to lists, I would suggest that anyone reading this bookmark these two sites for future use.

CHFA Approved Condo List

FHA Approved Condo List.

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Info about the author:

George Souto is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308 or gsouto@mccuemortgage.com