Lindsey Bishop is correct in stating HUD guidelines below. What prevents this from happening in most cases is the appraisals come back too low. So the builder/developer has no choice than to rent out the condos, until such time he can at least break even. At that point- firms such as mine, AmericaHomeKey Inc. can convince the builder/developer into letting these renters out of their leases to purchase and credit back rent for up to 2 years if they qualify for loans with us. Once we have at least 51% occupancy between old renters and new buyers- and all physical FHA building requirements are met, we submit the paperwork and get FHA approval. It can be a very lenghthy process.
Hope that answered your questions,
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