FHA Requirements for Condominiums Delayed Again

Implementation of the Fair Housing Administration’s new policy for condominium project approval and unit financing will be delayed until December 7th, 2009, as announced on October 21, 2009.

According to the notice to real estate professionals from FHA, when released in two weeks, the new guidance will:

1) offer additional leniencies to address the difficult market conditions and

2) augment some portions of FHA Mortgagee Letter 2009-19, providing additional information and clarification.

Until the new guidance takes effect on December 7th, 2009 lenders are allowed to continue to use the Spot Loan Approval guidance issued in Mortgagee Letter 1996-41. The notice also points out that site condominium and manufactured housing condominium project changes that have already been implemented are not affected by the delay.

Note our previous post on the evolution of these policy requirements and their implementation.

By: Amy H. Bray, a partner in our Commercial Real Estate department.