When HUD issued the Mortgagee Letter (ML09-46) that completely revamped the Condo Approval process, they had a “transition” strategy that was unclear or very vague. This “transition strategy” applied to ALL condos that were already approved for FHA financing. Well, they’ve certainly clarified it now.
Here’s a recap of what has just been clarified (and apparently, has been in effect since last year without telling all of us):
Ø ALL Condos approved prior to 01/01/2000 are no longer approved! As an example, if you have a listing or are going to write an offer on a Sunrise Cove Condo in N. Royalton, or Bellflower in Mentor-on-the-Lake, using FHA financing, it is NOT FHA approved now. ALL Condos approved prior to 01/01/2000 MUST be totally reapproved. This will be the lions-share of so-called FHA Approved Condos in NE Ohio since so few builders went through the added work and cost to get FHA approval after 01/01/2000.
Ø If the condo was approved 01/01/2000 or AFTER (like Concord Village in Avon or Princeton at College Hills in Painesville) , then it is eligible for the new (slightly less paper-intensive) Recertification Process unless someone has already done this since 10/01/2008. By the way, Recertification’s CANNOT be done by the Unit owner, buyers or Real Estate Professionals, and require the use of a HUD Recertification Checklist and Cover letter.
Ø If you need a copy of the Recertification checklist and cover letter required by HUD, please contact me.
Ø Once approved or Recertified, ALL Condos have to be Recertified every two years.
What stinks about these new rules are:
· We just received notice about this and it is effective immediately regardless of whether you are already under contract.
· This basically eliminates all FHA Approved Condos from being eligible for FHA financing unless they have been recertified or fully approved since 10/01/2008.
This article thanks to Jim Cook via Rita Legan ASP Staging Realtor with Keller Williams Realty Greater Cleveland Ohio Southwest at 440-227-4461 Cell/VM or email me at rlegan@kw.com
Jim Cook
GovieMan (tm), The ONLY Choice for FHA, VA and ALL Mortgages
Cell (216) 401-1717
eFax (440) 229-3389
jcook@thehls.com --- Please note my new email address.
The Home Lending Source, fka Consumers Mortgage.
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