You wouldn’t think that condominium complexes would do ANYTHING to jeopardize their property values in this fragile market. But in fact some still have the idea – apparently left over from decades ago – that FHA buyers are low-income trouble makers that you want to keep out.
Take it from me: this is not wise in a market where almost one-third of the loans issued since 2007 were FHA!
With the demise of zero down loans, 80/20 loans, 85/15/5 loans the only way that a buyer has been able to get into a condominium these last 3 years or so has been with either an FHA loan or a 25% or more down payment. (An FHA down payment is 3.5%.)
The FHA did require condominium complexes to re-apply for approval, and to prove that the projects were in reasonable financial shape, but not everybody reapplied, and some condominiums continued on course without seeking FHA approval.
Condo values have dropped, and homeowners’ dues have risen. Why make it worse by excluding a third of your potential buyers?
