FHA-Approved Condos
Buy a condo with an FHA loan and as little as 3.5% down for qualified borrowers. We help you check the HUD-approved condo list or explore single-unit approval.
- Insured by FHA / HUD
- 3.5% down for qualified buyers
- Single-unit approval may apply
The basics
What Is an FHA Condo Loan?
An FHA condo loan is an FHA-insured mortgage used to buy a unit in an FHA-approved condo project. Not every condo qualifies: you must meet standard FHA loan requirements, such as credit score and down payment, and the condo association must meet HUD's project guidelines.
With home prices rising, FHA-approved condos can be an affordable path to homeownership. Qualified buyers may put as little as 3.5% down, which can make owning a condo more attainable than you might expect.
- Insured by
- FHA / HUD
- Min. down
- 3.5% with 580+
- Occupancy
- Primary residence
How it works
Buying a condo with FHA in four steps
One licensed loan officer helps you confirm the condo's eligibility and guides you from pre-approval to closing.
- 01
Get pre-approved
Share your income, assets and credit. Your loan officer checks FHA eligibility and gives you a pre-approval letter.
- 02
Check the condo
We look up the project on HUD's approved condo list, or review whether the unit may qualify for single-unit approval.
- 03
Appraisal and underwriting
An FHA appraisal checks the unit's value and condition while your file and the project's details are reviewed against FHA guidelines.
- 04
Close and get your keys
Review your Closing Disclosure, sign your documents and move into your new condo.
Does the condo qualify?
FHA Condo Requirements
The key step in condo financing with an FHA loan is confirming that the condo project, or the specific unit, meets HUD's eligibility guidelines.
Investor/Rental Ratio
Generally, no more than 50% of units can be investor-owned or rented out. You must plan to live in the unit as your primary residence.
Commercial Space
Generally, no more than 35% of the project's floor area can be used as commercial space.
Delinquencies
No more than 15% of units can be more than 60 days delinquent on their homeowners association (HOA) dues.
FHA Concentration
FHA-insured loans generally cannot exceed 50% of the units in the condo project.
Completion
The condo project must be complete. Projects still under construction typically do not qualify.
Reserves and Insurance
The project must carry adequate insurance, and the HOA must keep at least 10% of its budget in cash reserves.
Single-Unit (Spot) Approval
Under current HUD rules, an individual unit may be eligible for FHA financing even if the full development isn't on the HUD-approved condo list. This is known as single-unit, or spot, approval.
Getting Your Condo FHA-Approved
Condo projects that want to accept FHA buyers must complete an approval process, either the HUD Review and Approval Process (HRAP) or the Direct Endorsement Lender Review and Approval Process (DELRAP), and recertify every three years to stay eligible.
FHA condo loan FAQs
An FHA-approved condo is a unit in a project that HUD has approved because it meets FHA standards, such as financial stability, owner-occupancy and insurance requirements.
Search the project on HUD's FHA condominium approval list. Your loan officer can look it up for you before you make an offer.
Sometimes. FHA single-unit approval may allow financing for an individual unit in a project that isn't on the approved list, if the unit and project meet the requirements.
The same as other FHA loans: 3.5% down with a credit score of 580 or higher, and 10% down with scores from 500 to 579.
Yes. Monthly HOA dues are counted in your debt-to-income ratio along with your mortgage payment, taxes and insurance.
No. FHA loans are for a primary residence you plan to live in.
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