I just had a buyer client close on a condo in Warren. She was using a FHA mortgage, and no,
the condo wasn't on the approved list. Her mortgage lender was able to obtain a "spot approval"
for the condo.
It was quite a simple process: The lender provided a form for the condo management company
to fill out. On it were approximately 12 questions. It took all of 48 hours for the management
company to complete and another 24 hours for the spot approval from the underwriter.
Do not let it deter you. It is quite possible that the 4 units you are talking about were issued
"spot approvals" also and the complex is simply not in HUD's approved list.
Good luck to you and enjoy your new home!
RE/MAX Advantage 1, Inc.
The previous respondents were correct in saying this would only be an issue if you had to do an FHA loan, as opposed to a conforming loan. Just because it is not on the list, however, does not mean you could not obtain an FHA loan on that property. FHA has a process called "spot approval" by which an exception can be made provided the condo development meets some basic guidelines for FHA financing. As Michelle referred to, there is a questionnaire that the condo association needs to fill out to determine eligibility. Some things they look at are the level of completion if it is a new development (must be 75% complete), the concentration of investors vs. owner occupied, and also the concentration of current FHA loans in that development (they place a limit on how many are allowed). Another big thing is that the association must have been turned over to the homeowners.
Spot approval is not too tough if it's an existing development, but is pretty difficult on new construction
Hope this helps...
Marilyn is correct. The only thing that will affect is an FHA based loan product. Now many lenders have alot of FHA products they use. So it is different to actually get a Non FHA lender product sometimes. I have seen a few strange incidences when it comes to FHA approval. What you are usually looking for is the underwriters approval for the bank and their interpretation of the FHA guidelines. We had a similar situation where one lender was approving counting contracts and sold units to achieve the FHA guidelines and another lender was not counting contracts but only units that had been closed on. It is best to discuss with your lender and they can tell you what their underwriter will say.
Coldwell Banker Triad