Answer
Following are the general FHA eligibility requirements for condominium project approval.

ELIGIBLE PROJECTS
To be eligible for FHA mortgage insurance, the project must have been declared and exists in full compliance with applicable State law requirements of the jurisdiction in which the condominium project is located and with all other applicable laws and regulations.

ELIGIBLE PROJECT REQUIREMENTS
1. Minimum number of units: 2
2. Insurance: Covered by hazard and liability insurance, and flood and fidelity as applicable.
3. Right of First Refusal: Permitted unless it violates discrimination laws
4. Commercial Space: May not exceed 25 percent of the total floor area
5. Investor Ownership: May not exceed 10 percent; or 1 unit for projects with 10 or less units. Units, common elements and facilities must be 100 percent complete
6. HOA Dues: May not exceed 15 percent in arrears (no more than 30 days past due)
7. Pre-sales: 50 percent must be sold prior to endorsement of the first loan
8. Owner Occupancy:50 percent must be owner occupied or sold to buyers who intend to occupy
9. Legal Phasing: Permitted subject to specific requirements
10. FHA Concentration: 30 percent or more subject to conditions. Information for each project will be displayed on the approved condo listing in the FHAC
11. Budget Review: Review of the HOA budget is required
12. Additional requirements may be applicable, e.g. for new construction and conversion projects

INELIGIBLE PROJECTS
Condo projects that are not FHA eligible are:
Condominium hotels or condotels
Timeshares or segmented ownership projects
Houseboat projects
Multi-dwelling unit condos (more than one dwelling per condo unit)
All projects not deemed to be used primarily as residential

To search for APPROVED CONDOMINIUM PROJECTS (LOOK UP) go to https://entp.hud.gov/idapp/html/condlook.cfm more information regarding condominium projects refer to Mortgagee Letters 11-03 (Extension of Temporary Guidance for Condominium Policy), 09-46A (temporary guidance-extended) and 09-46 B located at http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/index.cfm
Additional information regarding condominium project processing and recertification requirements is available at http://www.hud.gov/offices/hsg/sfh/condo/index.cfm

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