HR 3700 passed the House of Representatives (437-0) on Monday, February 2, 2016 and was referred to committee. Three key provisions of the bill are:
1- reduce the owner-occupancy requirement, for FHA-insured condominium approvals, to 35% (from the current 50%)
2- streamline the FHA approval process by expanding the number of lenders who can issue a DELRAP-approval
3- lengthen to approved time frame from the current 2 years (no definitive time)
It is our opinion that, because it was approved unanimously, it will get out of committee quickly and be sent to the Senate for a vote. The Senate is less "conservative" than the House so a super majority of votes to approve the bill is expected. President Obama has signaled that he will sign this into law. It is our opinion that this bill will become law as soon as April 1, 2016. This means that HUD could be approving condominium complexes, with less than 50% owner-occupancy, this Spring.
What does that mean to real estate professionals in San Diego?
It means that there will most likely be a flurry of FHA condominium submissions within two weeks of the bill becoming law. We think it is a good idea to start the FHA-approval process with us now. We can gather documents, prepare the package, and be ready to submit the day President Obama signs this into law, missing the expected onslaught of submissions.
Call me at 858-777-9751 with more questions.
