Colorado FHA Property Overview
New Construction
FHA has issued revised guidelines for single family residence new construction. These guidelines make allowances for the normal permit inspection process associated with any new construction process to take the place of FHA new construction inspection. This means that as long as the builder will accept an FHA contract, homes built in Colorado counties where an inspection process takes place during construction are FHA approved by default, and the only limiting factor will be the FHA loan limit (you can look up FHA loan limits by county).
Condominiums
New construction or resale, condominiums must be FHA approved (51% of the units in any given project must be owner occupied/not rentals). You can do a property approval search online for condos here. Keep in mind that the property must be certified by the lender at the time of closing as still meeting FHA's property guidelines, so project approval on FHA's web site does not necessarily mean the property still meets guidelines. It is also possible to request an exception from FHA for a property that doesn't meet guidelines. Talking with your mortgage consultant can be a great help if you're having a hard time finding the project you're interested in.
Townhomes
In January of 2003 FHA stopped tracking townhomes (and PUDs). Consequently, all townhome projects are now eligible for FHA financing regardless of the percentage of owner occupied units.
Manufactured homes
Double-wide manufactured homes are acceptable provided they were manufactured on or after June of 1976 with HUD tags clearly showing. The property must have a purged title (this can only happen if the home is permanently situated on land, it cannot happen unless the land and home are purchased together ... lot rental situations are not an option). The foundation must conform to FHA guidelines. This means there must be rebar anchored in poured cement or cinder block with poured cement, welded to the frame. A visual inspection of crawl space must also be completed.
Basic Appraisal Guidelines
To satisfy FHA guidelines, the appraiser must investigate a long list of health and safety related issues including: confirming no earth/wood contact, no peeling paint, visual inspection of the entire crawl space/basement, roof condition (if the roof appears to be in bad shape the appraiser can require a roof certification from a licensed roof contractor - or even require the roof be replaced), positive drainage away from the house, as well as additional considerations. Talk with your mortgage consultant or Realtor if you have questions or concerns about the home you would like to buy.
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