USDA Approved Condo List – Buying a Condo with a USDA Loan
In search of a USDA Approved Condo List? Maybe a single-family home is out of your price range or you’re just looking for a low maintenance property; then condominiums may provide the ideal living conditions.
There are also many condos and condo complexes that are eligible for the USDA 502 Guaranteed home loan, which can mean even more long-term savings.
Some of the best features of the USDA loans are they do not require a down payment, come with competitive rates and have less stringent credit and income guidelines than conventional loans.
To qualify for USDA funding, a condo must be located primarily in an approved USDA zone. As a buyer, you must also meet certain guidelines for income and credit to qualify.
Furthermore, the condominium must be listed on the Federal Housing Administration, Fannie Mae, Freddie Mac or Veterans Department A’s approved condo list to be eligible for USDA financing.
So what makes a condo USDA approved?
• A safe, structurally sound, and sanitary dwelling
• Must have appropriate insurances, if located in a 100-year floodplain must have flood insurance
• Must be listed as approved on the FHA, VA, Fannie Mae or Freddie Mac approved condo lists
Are there ineligible USDA condos for the program?
The following types of condos are not eligible for USDA: Timeshares, houseboat projects, condominium hotels, investment securities and community apartment projects.
Likewise, any condominiums that are in current litigation or used for business operations or income generation are also ineligible. If owners are allowed to hold title to more than one unit, these condos also do not qualify for a USDA loan.
How do you get a condo association USDA approved?
First, we will obtain the most recent budget and balance sheet from the condominium homeowner’s association (‘HOA”) in order to determine if the replacement reserves are at least 10% of the budget.
After that has been initially reviewed, the following items will be requested from the HOA:
1. Completed condo project questionnaire
2. HOA Rules and Regulations
3. Evidence of:
• Liability Insurance & Fidelity Bond coverage
• Master Hazard Insurance Policy
• Flood Insurance, if applicable
4. Additional documents may be required depending on the condo association*
The final steps of USDA Condo Approval & USDA Approved Condo List consists of the following:
• Once the appraisal is received, condo approval is finalized
• As the approved lender, our underwriter then submits the file to USDA
• After USDA commitment is received, the closing process beings
• Additional items may be required depending on the condo association*
Having a condo as an eligible property type can open up more affordable options for buyers all over the country, usdaloaninfo.com is here to guide you down the USDA Condo Approval path and help navigate the USDA home loan process.