Good news for condominium associations throughout the nation – the National Chapter of Community Associations Institute (CAI) reports that H.R. 3700, the Housing Opportunity through Modernization Act, has been signed into law by the President.
The Federal Housing Administration (FHA) will be required under the legislation to make the following changes to the FHA’s condominium approval process:
- FHA must establish and implement a recertification process that is substantially less burdensome than initial certification.
- FHA must cease and desist from rejecting condominiums that use transfer fees to fund association operations.
- FHA must lower the owner occupancy limitation from 50 percent to 35 percent (i.e., no more than 65% may be leased).
- FHA must provide additional flexibility for condominium projects with commercial space (i.e., mixed use developments).
It remains to be seen how quickly the FHA will be able to respond and implement these changes, as there are many details left to the FHA to determine. For now, the FHA has extended current applicable requirements through August 31, 2017.
Interested in pursuing FHA certification for your condominium association? These changes are not a reason to delay the process, as you may be able to obtain certification now. Review our prior blog post on the subject here and contact us at 248.644.4433 for more information. We have an excellent rapport with the FHA, which alleviates much of the red tape in the process.