Stevens Announces Delay of New FHA Condo Rule
In an address to the NAHB Executive Board in Chicago on Sept. 30, Federal Housing Commissioner David Stevens announced a delay in the Oct. 1 effective date for the new approval process for condominium projects required by Mortgagee Letter 2009-19.
He said that the Federal Housing Administration (FHA) is currently reviewing the new condo standards, particularly the rule limiting the concentration of FHA-insured mortgages to no more than 30% of a project. Stevens stressed that there has been no final decision on the rule, but that the limit is likely to be increased, although not up to 100% as NAHB has advocated.
A notice posted on the FHA’s Web site states that the effective date for the new condo policy is now Nov. 2. Importantly, the site condo and manufactured housing condo project changes that have already taken effect are not affected by this delay.
NAHB has requested a stakeholders meeting with Stevens to discuss the 30% concentration limit and other changes to the condo policy prior to the Nov. 2 effective date.
Stevens told board members that the FHA has been playing a major role in recovery efforts, insuring an “unprecedented” $400 billion in single-family loans, with 80% of its activity geared toward first-time home buyers.
For the year-to-date, he said that the FHA has insured 23% of the entire housing market.
To help resolve the foreclosure crisis, Stevens said that the FHA is engaged in 100,000 to 115,000 trial loan modifications per month.
“There are more loan modifications than foreclosures,” he said, noting that foreclosures are running at 80,000 per month.
Citing the need for a strong FHA, Stevens said his agency is the “biggest business inside government and the only business that is positively capitalized, requiring no taxpayer subsidy.”
For more information, e-mail Bill Renner at NAHB, or call him at 800-368-5242 x8597.
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