FHA Single Unit Approval (SUA) Process
HUD introduced the Single Unit Approval (SUA) process in 2019 to allow FHA loans on individual condo units without requiring full project approval. Here’s what you need to know.
Introduced 2019
The SUA program went live on October 15, 2019, replacing the old “spot approval” program.
Minimum 5 Units
The condominium project must contain at least 5 units to qualify.
Owner Occupancy
At least 50% of units must be owner-occupied (no exceptions).
Commercial Limit
No more than 35% of the project may be commercial space.
How the SUA Process Works
Application via Lender
The SUA must be submitted by a lender with Direct Endorsement (DE) underwriters. HOAs and Realtors cannot apply directly.
Questionnaire & Documents
The Board/Management must complete a questionnaire and supply documents. It cannot be done without HOA participation.
HUD Review
HUD issues conditional approval. The lender must confirm the association meets requirements before issuing a loan.
Repeat for Each Unit
SUA is unit-specific. Each additional unit requires a new application, questionnaire, and full review.
SUA Basic Requirements
- Project contains at least 5 units
- Manufactured homes are not eligible
- 10+ units → FHA concentration limited to 10%
- Less than 10 units → max of 2 may be FHA insured
- Commercial space ≤ 35%
- Owner occupancy ≥ 50% (no exceptions)
- Project not currently “approved” or previously rejected for adverse determination
- Meets all FHA property standards
Benefits of Full Project Certification
- The entire association is FHA approved for 3 years
- Streamlined renewal process
- Less repetitive burden compared to SUA
- Units can be marketed as “FHA Approved”
- HUD, not the lender, assumes liability
Simply put, the SUA may be a shortcut if using a DE lender — but for most communities, full project approval offers greater flexibility and long-term value.
How We Can Help
FHA Review provides a Single-Unit Approval Case Binder service to help lenders, banks, and brokers prequalify a unit before appraisal and inspection. This ensures eligibility and reduces wasted time and liability.
HUD’s Final Rule (2019)
On April 14, 2019, HUD issued a press release announcing the final rule for Single Unit Approvals. Highlights include:
- Allows individual condo units to be FHA insured in non-approved projects
- Extends condo project recertification from 2 to 3 years
- Expands eligibility for mixed-use projects
Full regulation: Read FHA's condominium approval regulation
Single Family Policy Handbook Guidance: Read FHA’s Handbook update
Learn More
Eligibility Requirements
See what your community must meet to qualify for FHA condo approval.
Required Documents
Find out which documents your HOA or manager needs to provide.
Pros, Cons & Misconceptions
Get the facts: benefits, challenges, and common myths explained.
FAQ Library
Answers to the most frequent FHA condo approval questions.