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You found the perfect condo and plan on using your VA home loan benefit to put in the perfect offer. You then learn your condo project hasn’t been reviewed and approved by the VA. What now?
If you’re interested in VA financing for your condominium unit, but your condo project is not on the VA-approved condo list, don’t panic. There’s a clear path to getting your project approved and ready to take advantage of your VA benefits.
The VA provides a loan program that gives veterans financing opportunities at competitive rates and with low down payments. If the subject property is a condominium unit, the condo project is required to be preapproved by the VA in order to ensure that the project meets basic quality standards in place to protect veterans.
Finding Out If Your Condo Project Is Approved
If you’re an eligible veteran and interested in purchasing a condominium unit, or refinancing one you already own, the first step to ensuring a smooth ride on the VA loan process is to take a peek at the VA-approved condo project list.
The VA condo page gives users criteria to narrow their search. You should try casting a wide net by searching for the state you’re in, and looking for the condo project you’re interested in on that list. If you are able to locate your project on the list, and its status reads “Accepted Without Conditions,” you’re clear to apply for VA lending on the project.
If you are able to find your project, but the status of the project is listed as something else, like “Accepted With Conditions,” “HUD Accepted,” or “Rejected,” you should reach out to the local VA Regional Loan Center (RLC) to learn about the next step.
Securing Condo Project Approval
The VA maintains regional centers that administer many VA lending benefits, including reviewing condominium projects to determine whether they meet their lending criteria.
Sometimes, it’s as simple as the RLC staff updating the condo listing. The VA may request additional documentation from the condo project, like a copy of the condo bylaws. Other issues, such as rejections, may require the condo project’s homeowners association to revise some section of their governing documents (eliminating resale restrictions on units, for example). If the status of your project is anything but “Accepted Without Conditions,” reach out to the RLC and inquire about the best course of action.
If your condo project is not on the list at all, it’s time to start the application process. That same friendly RLC also accepts and reviews applications for condo project approval. The application process is relatively simple: collect the required condominium documents, submit them to the RLC with your contact information, and wait for their determination. Often, the biggest challenge is collecting the required documents. Help is available from the condo homeowners association (HOA), your county clerk and RLC.
The VA condo project approval application is going to require some documentation. Here is what you’ll need to provide:
- Recorded Condominium Declarations (aka CC&Rs) or master deed
- Recorded project plat maps (plans showing property division) and/or condo site plan
- Recorded Articles of Incorporation
- Signed copy of the condominium bylaws
- Meeting minutes from the past two HOA meetings
- Condo budget and balance sheets
The VA RLC will also need to see a statement from the HOA, addressing the following questions:
- Are there any current or planned special assessments?
- Is the project involved in any current or pending litigation?
- Is construction of the project complete?
- How many of the project’s units have been sold from the developer?
The recorded governing documents and plat maps can be tricky to obtain. If you are refinancing, you may already have a copy from a resale or move-in package. If you are buying, ask the selling agent to obtain a copy from the HOA. If the project retains the services of a management company, they should be able to provide copies. If all else fails, visit the local county clerk or recorder’s office to request copies of the project’s recorded documents. Let the clerk know what you are working on. They can be a great resource for help and information.
Documents like the bylaws, budget, and HOA meeting minutes are not recorded, so they will need to be obtained from the HOA board or management company. If you are refinancing your unit, these should (in theory) be a breeze to get. If you’re a buyer, get the real estate agent involved so you can contact the HOA or management company for copies.
Once you’ve collected the documents required for the application, it’s time to submit to the RLC for review. Call the RLC office (option 3 for condominium questions), and find out their preferred method for delivery. Some recommend email or fax, others prefer good, old-fashioned post. However you send it, get the package in, along with a cover letter providing your contact info so the VA can reach out to you with any additional requests or status updates.
The RLC will review the package to determine whether it is complete. If anything is missing, they will reach out to you asking for additional documentation. If everything is in order, they will send the application along to their staff attorney, who reviews the governing documents to ensure that the project is meeting VA lending guidelines. The full review can take up to four weeks, depending on their current volume of applications.
Once the VA has made a determination, they’ll reach out to you (provided you gave them your contact info) and inform you of their decision. If all went well, you should now be able to find your project on the VA approved condo list. The project is now eligible for VA lending.
Although it can be a challenge to obtain the documents required for VA condominium project approval, it is well worth the effort for veterans to take advantage of the benefits they have earned.
Is your project already on the list? If you’re ready to get a condo with your VA loan, get started today or reach out to one of our Home Loan Experts at (888) 728-4702.
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