@Anonymous wrote:
Dear Forum,
My boyfriend and I asked our real estate agent to make an offer on a condo and in the process we found out that the condo is not FHA approved. Our real estate agent did not find this fact out until after the offer process..is this normal? I just talked with my loan approver and she has stated that she will not be able to do an FHA spot Approval for this condo and she has stated that she believes no one will. Is this true? Or is she just saying that so that we will not look elsewhere. We really like this condo and do not want to lose out on it if we win the bid. Please let me know if you have any knowledge on this topic. Any advice would be greatly appreciated. I am currently working with the CalPers Program for the loan (Work for a community college in California). Thank you, Dee
Your LO is probably correct. Spot approval is a difficult proposition for condos. There are a few major hurdles for condo projects - at least 51% of the condos must be owner-occupied, for one. For spot-approval (without getting the entire project approved), it also requires that at least 90% of the units are sold, no more than 10% can be owned by a single entity (for example, an investment group), there can be no legal actions or special assessments pending in the complex, and no more than 10/20% (number varies by size of complex) can have FHA mortgages already. There are some others as well, but the above are the most common reasons to have trouble getting a spot approval from what I've heard.
