What are the benefits of
FHA condo approval?
NOTE: These are “regular” buyers – an FHA loan is not associated with low income HUD programs, such as Section 8. In some counties, an FHA insured loan can reach amounts of $800,000.00 or more. Since the recession, most American buyers are using FHA insured loans, and this will be the trend for years to come.
This means that in the future an FHA Loan can be assumed (including the interest rate) by a new buyer. With interest rates at an all-time low, this can be a very valuable asset to an HOA community.
Some real estate agents won’t show units that aren’t FHA approved. Being approved sets your community apart from others in your same area.
Going through the FHA condo approval process gives your Homeowners the sense that you as a Board cares about the community and wants it to thrive.
Generally speaking, Buyers who use FHA loans are more likely to reside in the unit, and not rent it out. Conversely, communities without FHA approval will attract buyers that can make large down payments. These buyers are usually investors who will rent the property for a profit.
Board Members and Property Managers are expected to maintain property values in their communities. Several HOA attorneys advice that it is the fiduciary duty of the condo Board to apply for FHA condo approval to maintain or increase property values for residents.