This community is not FHA approved! Sometimes it's for a good reason!

Real Estate Agent with Thompson Company, REALTORS® MD594797

I am preparing to list a condo in the Marble Hill subdivision in Elkridge, MD [more info about this listing coming real soon]. Although I am very familiar with the subdivision, having shown many properties, having sold a few and actually owning a condo there myself, I still want to and need to do my due diligence, check out all the comps and verify all the facts. 

In doing so, I've been noticing a pattern.. almost every recent listing contained a warning: This community is not FHA approved! Some softened "the blow" and added an apology: sorry! Disclosing this information and making buyer's agents and potential buyers aware of this fact before they tour properties and possibly fall in love with one is, of course, not a bad thing. It's what we must do. 

But we shouldn't turn facts into warnings, omit the reasons for the missing FHA approval, and possibly scare ready, willing and able buyers off. Sometimes there's a good reason why a community is not FHA approved. By the way, there are way more communities without FHA approval than there are with!  

It is a common misconception that the Federal Housing Administration loans money. It doesn't, but it does insure mortgages. In order to be eligible for such insurance, communities must meet and maintain certain eligibility requirements - when they fail, they are not FHA approved. I don't want to get too technical, but to briefly summarize, two of the most common reasons are: too high of a delinquency rate (for dues & assessments) and too many investors vs. owner-occupants. But there can be other reasons, too, as is the case with the Marble Hill Condominium in Elkridge, MD. 

Homes near Ducketts Lane Elementary SchoolThe reason this Howard County subdivision is not FHA approved has to do with the Sex Offender Registry.

The condominium governing docs contain language that "restrict" (according to the FHA) owners in selling/leasing to people listed on the sex offender registry.

In my professional and personal opinion, this little tidbit of information makes the "not FHA approved, sorry" warning a whole lot less scary, especially because Ducketts Lane Elementary School sits right across the street from Marble Hill and the community is popular with young families.

Knowing this reason for the missing FHA approval could very well influence the buying decision of (some) people, and consequently help the Marble Hill community thrive (even more)! 

When you are house-hunting in HoCo, or MoCo, or beyond and come across a warning that "this community is not FHA approved", don't let it scare you away, but ask WHY! You may just find that it's for a good reason!

You may also find that a different loan program has comparable, or even better, terms ... it never hurts to talk through your options with a reputable lender! Bridget "Mortgage Mama" McGee is one of them. Many, many communities throughout the country don't have FHA approval, it's not as scary or bad as some make it sound, and most buyers do have other options. 

And should you be interested in buying - or selling, or both - in Marble Hill, I would love the opportunity to chat with you! Give me a call at 240.593.2860. 

Posted by







Thompson Company, REALTORS
16910 Oak Hill Rd, Silver Spring, MD 20905
o: (301) 384-9177 c: (240)593-2860

Andrea is a REALTOR® based in Silver Spring, MD. She has enjoyed assisting buyers and sellers since 2004 and focuses on residential Real Estate in  Montgomery and Howard County, MD. Andrea is a proud mom and hobby decorator with a vintage soul. She always answers the phone with a smile, enjoys running and treasure hunting and is addicted to coffee.


 All photographs are my own and I'd like to keep it that way. All information is deemed reliable but not guaranteed.




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Kat Palmiotti
Grand Lux Realty, Monroe NY, 914-419-0270, - Monroe, NY
The House Kat

Great point. Sometimes the reasons behind facts are just as important to know.

Jun 19, 2019 02:56 AM #1
Brian England
Arizona Focus Realty - Gilbert, AZ
MBA, GRI, REALTOR® Real Estate in East Valley AZ

In helping people purchase a condo, this is always a concern if they need to use an FHA loan.  It seems that conventional loans have the same benefits as an FHA loan these days though, without the restrictions, so most people just utilize a conventional loan.

Jun 19, 2019 07:32 AM #2
Andrea Bedard
Thompson Company, REALTORS® - Silver Spring, MD
M.A.; REALTOR® Silver Spring, MD and beyond

Exactly Kat Palmiotti! So often, the devil is in the details, and those details may influence people's buying decisions. 

Hi Brian England It's good to know whether or not a community is FHA or VA approved before going on hometours. Some people may like the reason why this community is not approved - and utilize a different loan program instead. 

Jun 19, 2019 09:36 AM #3
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Andrea Bedard

M.A.; REALTOR® Silver Spring, MD and beyond
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