New FHA Financing Rules for Condominiums - Thank Goodness!

By
Real Estate Agent with RE/MAX Commonwealth

On November 6, 2009, the Department of Housing and Urban Development issued new guidance relaxing the financing requirements for condominiums.  For condominium developers, listing agents for condominium projects, and condominium buyers, this is GREAT news.  Basically, an individual buyer may now get FHA financing in a project that qualifies.  What's so great about FHA financing?  It allows the least amount of money down (3.5%), has lower credit score requirements, and allows a "non-owner occupant co-borrower," which is fancy HUD-speak for a cosigner on the loan.

So what does this mean practically?  Someone starting out could buy a $200,000 property with $7,000 down (3.5% of the purchase price), a 620 credit score, and mom and dad co-signing on the loan.  This someone would need to come up with another $7,000 or so dollars in closing costs, but most sellers in this market are willing to contribute at least some of the closing costs to get a deal done.  So let's assume the closing costs were covered.  Then, the buyer could amend his or her 2008 taxes to claim the 2009 First Time Home Buyer Tax Credit of $8,000, and could essentially end up getting PAID $1,000 to buy a condominium.  If your monthly payment is the same or similar to your rent, why wouldn't you do this? 

Sounds like a pretty good deal to me.  And I've got some GREAT condos to sell, the Windsor Court Condominiums, in the heart of the Historic Fan District, located at 1608-1614 Grove Avenue.  You can't buy a house in the Fan for $200,000 - an entry-level house is going to cost you about $300,000 minimum and will require work.  I've got units priced from $194,900-$239,900 that have all new kitchens, granite, stainless steel appliances, refinished hardwood floors, the works.  AND there is dedicated parking.  There is even the option of a garage at no additional charge, available on a "first come, first served" basis. 

Here's the website - www.windsorcourtcondominiums.com - check it out.  There is a virtual tour on the website, for even more eye candy.  If you see anything you like, give me a call at 804-986-3993, or drop me a line at melissasavenko@gmail.com.  I'd be happy to show you around.

Comments (1)

Sonja Babic
Sonja Babic/PRIME Realty NC, LLC - New Bern, NC
New Bern NC, PRIME Realty NC, LLC

Great info thank you very much. I am so glad we finally have some good changes in the industry.

Nov 12, 2009 01:59 AM