FHA doesn't allow more than 50% of an association to be rented to be eligible for FHA financing. Once more than 50% of the units are rented then FHA will not lend and the association's FHA approval could be withdrawn by FHA.
Associations are putting rental caps in place so investors don't buy up units, since prices are very reasonable. Some Association's want their condos to be more owner-occupied than investor so they cap the rentals at a certain percentage.
Condo Approval Professionals LLC
The lower the rental % in the building, the better. Fannie Mae allows for as low as 51% owner occupancy however many lenders have tighter restrictions and will deem the building "non warrantable" if they aren't met.
There are other avenues to approve a building with Fannie however. And there are also lenders that will lend money on non-warrantable buildings.
We can provide financing for all types of condos, depending on the situation. Please contact me if you'd like to discuss further. I'd be happy to help.
(As for your other question, that sounds like it's legal but I"m not sure. Either way, I don't think the HOA would be too thrilled)
1st Advantage Mortgage (a Draper & Kraper Co.)
312-608-1555 - cell
There's no such thing as an emergency rental, quitclaim deeds are for sales not rentals.
Rent to own is more an urban myth than anything else. Typically it's ultra savvy sellers taking advantage of less savvy buyers. In more than 35 years I have never once seen a buyer who entered a rent to own agreement ever own the property and the sellers never really intended for them to do so.
You really need to speak to a local attorney and or Realtor, I can tell by your questions that you're going to find yourself having substantial problems if you don't.