Condos, just like single-family homes, can be approved by the VA and funded with a VA home loan. In order to get VA condo approval, however, you must follow a slightly more complicated process since condos generally come with a different type of ownership.
Is Your Condo Already VA Approved?
Most condos do not already have existing VA approval, and this is the reason buying a condo with a VA loan gets complicated. So, if you picked out a few condo possibilities and are still deciding which would be a perfect fit for you, check to see if any options already have VA approval. You can visit the VA’s website to see a list of approved condos. Each condo may be listed individually or under its common interest community. It’s possible for a condo subdivision to be listed under alternate names, so if you do not find the condo you want there, you can contact the Department of Veterans Affairs for help. If your condo really does not have VA approval yet, then you need to apply for it.
VA Approved Condos Status:
Approved without conditions – the condo is approved and you can use a VA loan to finance it.
HUD approved – the condo has been approved by HUD and is probably approved by the VA.
Unaccepted – the condo has been rejected and you cannot finance the condo with a VA home loan.
How to Get a Condo VA Approved
If the condo of your dreams is not yet on the VA condo list, it will need to go through the approval process before you can use a VA loan to finance it. The entire process is usually completed within 30 to 45 days, but in some cases, this time is much longer at about 90 days.
Even though you would be the one buying the condo, the condo association or property manager must be the one to request VA approval and send in necessary documentation. After the organizational documents have been reviewed by the VA, they will either send a rejection or acceptance letter with a list of reasons for their decision. FHA approved condos generally receive VA approval as well.
It’s also important to know that the condo must meet three major requirements for VA condo eligibility:
- The complex must have at least a 50 percent occupancy rate.
- 85 percent of owners (or more) must be up-to-date with all HOA fees.
- 75 percent of more of the units in the complex must be sold if the complex is newly constructed.
Sending in a VA condo approval request at the beginning of the condo-buying process will help you close faster. However, if time is of the essence (as it usually is) and you cannot afford to wait potentially 90 days to know whether or not your condo is approved, you can rush the process in some cases. Keep in mind though that the fee to do so can amount to $1,000 on top of the existing fee of $850. In addition to the fee, you will need to submit additional property paperwork to rush the process.
VA Condo Approval Checklist of Documents
The condo association or property manager will need to send several documents to the VA, a majority of which will need to be gathered prior to filling out the application:
- HOA signed bylaws
- HOA Articles of Incorporation
- CC&R’s, also known as the Master Deed
- Management agreement
- Minutes from the last 2 HOA meetings
- Budget of the HOA
- Balance sheet and income statement
- Survey of air lot and/or plat map
- Plans for the condominium
- Recorded annexation amendments
For newly constructed developments, some additional documentation is needed.
Is a VA Approved Condo Right for You?
Unfortunately not all condos are VA approved condos. If yours doesn’t, you can simply finance it through other means. However, the best idea is to move on because chances are there’s something wrong with the condo. But before going through the VA approval for condos process at all and applying for a loan, be sure that a condo is right for you. Would you be happier with a single family home? Take a look at some of the distinguishing features of condos to determine whether owning a condo is right for you. If these condo features seem ideal to you, buying a condo is probably a great idea.
- Close proximity to neighbors
- Very little maintenance
- Potential amenities such as a clubhouse, workout room, playground, or pool
- Perfect size for small families and single residents
- Usually no garages
- HOA fees that could increase in the future
- Usually close to town
- Strict community rules
Financing a VA Condo
When you know the condo you want is VA approved, the next step is going through the buying process and getting a VA home loan. At Low VA Rates, we finance all sorts of homes and finance condos all the time. We’re happy to help you gain approval and complete the loan application process. We pride ourselves on offering terrific rates for our veterans. Call us now at 855-223-0705 to get started.