Buying a Condo? Are you getting a Mortgage or Paying Cash?

If you are buying a condo and you plan to get a mortgage, you need to find out if the complex is FHA Approved.  You need that information even if you are getting a Conventional Loan. It used to be possible to get FHA “spot approval” for an individual unit. That option has been completely eliminated as of February 2010. Now the complex has to get approved. It didn’t used to matter at all because there really weren’t that many differences between FHA and Conventional financing. Currently, unless you have 20% to put down, the only kind of condo financing reliably available is FHA.

I recently had a deal where the buyer paid cash for the condo. He told me that it doesn’t matter to him that the complex isn’t FHA Approved. I told him that he may not care now, but eventually it will matter because he will need to sell it. The bigger the pool of potential buyers, the higher the demand there will be for the property. The higher the demand, the more likely the sales prices will go up. The more difficult it is to get a loan for units in the complex, the more likely it is that prices will be stagnant, or Heaven Forbid, go down.

To find out if the complex is on the FHA Approved List,

https://entp.hud.gov/idapp/html/condlook.cfm