There are great bargains to be had for FHA Loan borrowers on condos and town homes in today’s market, as long as you are educated and make the right choice on which condo or town home to purchase.
Here are some advantages of condos vs. single-family-homes for FHA Home Loan borrowers:
- Condos usually have lower overall prices than single-family-homes
- Affordable condos can often be found in prime neighborhoods and prime areas with good school districts. Areas where prices of single-family-homes are out of reach
- I think this is an important point. You can often find a condo that you could afford in the really prime neighborhoods, beach areas, and great school districts. Where a single-family home in that same area would sometimes be completely out-of-reach. Owning a condo in these types of neighborhoods allows you to enjoy living close to amenities, great schools, beaches etc… Where if you bought a single-family-home for the same price or more you would be in a below average neighborhood with poor schools and less parks, beaches and amenities.
- Condo owners are responsible for less upkeep and less maintenance than owners of single family homes
- With a condo, generally the owner is only responsible for the interior of the condo and the homeowners-association is responsible for all the exterior areas
- This means you don’t have to worry about mowing the lawn, roof leaks, exterior painting, etc…
Here are some dis-advantages of condos vs. single-family homes for FHA Loan borrowers:
- Single-family homes can hold their value more Although not true in every case, generally single-family-homes go up first in value and go down last
- Condos and Town homes have homeowners association dues
- Condos and Town homes have to be approved by FHA in order to use a FHA Home Loan to Purchase
Below is some important research for FHA Home Loan borrowers to conduct prior to purchasing a condo:
- Make sure the condo is approved by FHA. You can find this out by contacting us.
- Find out the percentage of owners vs. renters in the complex by contacting the homeowners association
- Make sure the homeowners association (HOA) is financially sound and has adequate reserves to cover repairs so there are no special assessments. A rule of thumb is 25%-30% of the HOA gross annual income should be in reserves.
- Check with the HOA to find out if there are any pending special assessments. A special assessment is a fee the condo HOA will ask you to pay above and beyond your monthly HOA dues to pay for condo repairs the HOA does not have enough cash for.
- Get a copy of the CC&R’s from the HOA and read them
- Get the latest copy of the HOA’s meeting minutes to review
- Check to see that their is no pending litigation against the HOA or against the builder
- Check to see how HOA dues compare to nearby condors
- How long has the complex been managed by the same company? The longer the better.
- Ask other condo owners what the like most and least about living there
- Check the soundproofing the of the common wall
If you do your research up front you can often buy a condo with a 3.5% down FHA Loan that will be a tremendous investment for you and that you will enjoy for years to come. Please contact us to get pre-approved for a FHA Home Loan to be ready to purchase your dream condo today.
Rob Chomentowski
Sr. Loan Officer
858-922-7899
rob@affinity-financial.com
www.socalfhahomeloans.com
www.socalvaloans.com
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