Another change is taking place in the mortgage arena. A recent HUD letter to lenders is shifting more responsibility to lenders regarding financing condominiums, at least that is how I read it. I was alarmed today when I heard one of our wholesalers will stop accepting FHA spot approvals next Friday. Up to now lenders were able to approve a condo for FHA insurance when it was located in a project that was not approved by FHA. That process is being eliminated.
Of course that sounded bad to me. Just another option eliminated. But then I actually read the letter, and it does not sound bad at all. In fact it sounds good. Lenders are going to be able to approve the entire project instead of just one unit. There will be limitations, no more than 1/3 of the project can be financed using FHA, but it is a big move in the right direction. Thousands of additional condos in the Louisville area could now be eligible for maximum FHA financing. AAAhhhh, folks that could make your condo worth more!!!
You can read the letter for yourself: Click here
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