On March 11, 2021, NAR joined the Community Home Lenders Association (CHLA), National Association of Homebuilders (NAHB), Community Associations Institute (CAI), Independent Mortgage Bankers Association (ICBA), Community Mortgage Lenders of America (CMLA), and the Institute of Real Estate Management (IREM) in sending a letter to newly confirmed HUD Secretary Fudge, seeking reforms to improve the approval process for FHA condominium loans.
The proposal recommends that FHA should allow lenders to self-certify compliance with FHA condominium approval requirements - with HUD conducting a limited review of key criteria. This approach would provide a more transparent, streamlined approval process, while preserving essential approval standards. It is patterned after the process and approach currently taken by Fannie Mae. The proposal also seeks review and potential lifting of the prohibition against proposed and under construction condo projects.