The Federal Housing Administration this week published interim guidance in Mortgagee Letter (ML) 2019-13 that provides instructions for mortgagees to obtain single-unit approval case number assignments. The supplemental guidance follows the August 15th publication of a final rule that streamlines condominium approval policies to help more condo owners qualify for FHA financing, including Home Equity Conversion Mortgages.
The information contained in ML 2019-13 applies to case numbers assigned on or after October 15, 2019, the same date the final rule and condominium policies added to HUD Handbook 4000.1 take effect.
Individual units may be eligible for single-unit approval if:
- The individual condominium unit is in a completed project that is not approved;
- No more than 10 percent of the individual condo units are FHA-insured (properties with 10 or more units) or properties with fewer than 10 units have no more than two (2) FHA-insured units.
Under ML 2019-13, mortgagees must complete the Case Number Assignment screen in FHA Connection and submit the required information separately via email to the FHA Resource Center in order to process a case number request using the single-unit approval process. If a condo unit is in a project that is not currently FHA-approved, but the property has an FHA Condo ID, the mortgagee must enter the FHA Condo ID when the FHA case number is requested.
FHA systems will be further enhanced in the future to permit single-unit approvals. In the interim, read ML 2019-13 for more detailed instructions.
FHA will also be holding an industry stakeholder briefing call, designed to assist mortgagees and others to better understand the new condominium project approval requirements. That call will take place on Tuesday, September 10 at 2:00 pm Eastern time. The dial-in number is (800) 230-1092.