FHA & VA condo certification for the State of Florida
To meet FHA and VA guidelines, all condominiums must comply with the following leasing restrictions:
- The HOA must allow leasing in the community.
- There must be no transient leasing of units (defined as less than 30 days) – this guideline only applies to FHA, not VA.
- There must be no “seasoning clauses” that require unit owners to occupy their unit for a specified time before leasing. Some hardship clauses may be acceptable, but this should be evaluated on a case-by-case basis.
- The Board of Directors cannot have the power to approve or deny leases, or impose background checks, credit checks, or other screening for prospective tenants. The unit owner must have the right to lease to any tenant, and may impose their own screening requirements.
We commonly observe leasing restrictions similar to those described above in the state of Florida.
If the HOA does not meet these criteria, they will not be eligible for FHA or VA approval. In order to become approved, they will need to amend their legal documents to remove any policies that do not comply with these guidelines. This process typically requires board initiative and a vote of the entire community.
VA Waiver Exception:
For individuals seeking VA loan products, it is still possible to obtain a VA loan using a waiver even if the community in which the property is located is rejected for VA approval. A waiver allows the borrower to use a VA loan to purchase a property in a non-approved community, and is typically granted in cases where the borrower has a strong credit history and a sufficient down payment. However, obtaining a waiver is not guaranteed and each case is evaluated on an individual basis. It is recommended to speak with a lender or VA representative for more information on the requirements and process for obtaining a waiver.