FHA Releases Updated Condominium Guidelines: Addresses Areas of CAI Concern and Makes it Easier to Get Project Certification
As you may be aware, in the past, getting FHA certification for condominium projects has often been very challenging, and this has been a concern for CAI and GSL.
Now, we are pleased to report that FHA has released updated guidelines for project approval, and it has addressed key areas of our concerns. Most importantly, FHA acknowledged that certain policy changes were needed in light of current housing market conditions. The upshot of these changes is that some regulations will be relaxed, and it will now be easier to secure project approval (assuming that associations will adhere to the new guidelines).
These temporary FHA policy changes went into effect on September 13, 2012, and the new approval process will be in place until August 31, 2014, unless further extended by FHA.
Preliminary analysis of the guidelines reveals policy changes in the following areas: project certification, delinquencies, employee dishonesty insurance, and commercial space limitations. If you haven’t seen the new regulations, we encourage you to review two important documents linked below:
- The CAI notice to members summarizing the changes
- The official notice from the US Department of Housing and Urban Development (known as “Mortgagee Letter 2012-18”)
At GSL, part of our services to associations includes assistance with the project certification process. If you would like our counsel regarding interpretation and implementation of the new FHA policy,
please contact us.