FHA Guideline Changes….Coming to a Condo Development Near You

More change is in the air for developers of condo projects and for condo owners who desire to get approved for FHA Financing.  The details of the changes coming can be found in the 2009-19 Mortgagee Letter on the HUD website issued 12-June. The FHA is annoucing profound changes to their condo approval process and the outright elimination of the Spot Approval Process.  Lookout lenders, more burden, work and overall responsibility is coming your way, while full condo approval documentation and requirements will see a reduction. These changes will become effective 1-Oct. '09. Although, the ripple in the water will almost start to be flet immediately.

2 options for Lenders for condominium approval processing:

  1. HUD Review and Approval Process (HRAP).
  2. Direct Endorsement Lender Review and Approval Process (DELRAP), outlined in this Mortgagee Letter. This option is only available to lenders who have unconditional Direct Endorsement authority and staff with knowledge and expertise in reviewing and approving condominium projects.

The processing options stated above will be applicable to condominium developments that are:

  1. Proposed/Under Construction;
  2. Existing Construction; or
  3. Conversions.

Eligible Projects:

The Condominium Project has been created 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.

Certain types of projects will be ineligible. For Instance:

  1. Condominium Hotel or “Condotels”
  2. Timeshares or segmented ownership projects
  3. Houseboat projects
  4. Multi-dwelling unit condominiums [i.e. more than one dwelling per condominium unit]
  5. All projects not deemed to be used primarily as residential

The major 'Negative" in these new guidelines is the the “Spot Loan Approval” process being elminated. The processes have been streamlined to allow for uncomplicated condominium project approvals eliminating the need to approve units on a “spot loan” basis,” according to HUD. Alomost certainly this new approval process will add more time to the approval of a Condo Project compared to the more immediate quick “Spot Approval” process. 

 Who will challenge the elimination of the Spot Loan Approval process? Realtors? NAR?

The Waiting Game! Are you playing it too?

If you are waiting for the market to hit bottom to purchase a home in Charleston, SC or if you are waiting for prices to start going back up to sell; you are playing the most popular game today ~ Yup, the Waiting Game

Would-be sellers might be waiting for a long time, and buyers, well, as for when the bottom will hit, it depends on who you ask.  Like everything in life, there are two ways of looking at every situtation. Real estate is no different. 

Of course every seller would prefer to sell high and buy low.  However, if you sell for lower than you would like and are able to buy for lower than it would have cost just last year, doesn't that make for a fair trade off? Ideal, no, worth exploring, yes.

If you are looking to upgrade, NOW is the time.  This could be your chance of the dream home on or near the water.

With no access to the all-telling crystal ball – the question to ask yourself is, "How long am I will willing to wait?" Each person will have their own situation to assess but if you are looking to upgrade, downgrade or make that first purchase, now is as good a time as any!


Priced to Sell, or NOT

It still amazes me that people just don't get it.  Please, let me be CLEAR ~if you are trying to sell your home in this market, price it right or it simply won't sell

Listing appointments have turned into more than the presentation of the good old days that included the marketing strategy that would be employed to sell the home, to first serving up a hearty dish of price reality.  Now, there are certainly enough resources on the internet for sellers and buyers alike to educate themselves before testing the waters on either side of the transaction.  Truila, MLS, Realtor websites, Realtor.com, and of course Zillow and its controversial Zestimate are just a few. With the millions of monthly visitors all of these marketplaces claim visit their sites and consume their content, you would think my job would be getting easier, not harder.

If your house has been on the market for awhile and is still on the market, it is clear that either you didn't listen to your realtor or your realtor didn't give you good information. Either way, the conclusion is obvious, YOU PRICED YOUR PROPERTY INCORRECTLY!

It stands to reason, with high inventory levels, more and more foreclosures and short sales coming on the market monthly, that reasonable pricing will peak interest, but unrealistic pricing will not benefit either party.

Educate yourself so that when you meet with a realtor you have realistic expectations.  Keep in mind though, all the resources available on the web still won't be able to provide the most up to date market information. None of the other sources has all the data necessary.  A realtor can provide your most up to date and complete market analysis. 

Price them right folks! And if you can't sell, consider renting! It seems to have worked for the Treasury Secretary! I guess he missed my price it right rant! See his story here!