Prefer to talk in person? Find a mortgage specialist on Zillow
Profile picture for rmmiki1890

i heard that FHA loans don't cover co-op purchases.. Does anyone know if this is true?

I have the opportunity to purcahse one but someone told me that this was the case
  • August 08 2009 - Bronx
  • 0
    0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

Answers (18)

Best Answer

Profile picture for Chris Corica
rmmiki - was there a reason you were only looking at FHA?
  • August 09 2009
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Yes, agree. You are linking to HUD but some of the links ( not yours ) posted on this thread go to some CLONE FHA site like MYFHA....I think that poster believes that to be the HUD site when it's not.
  • March 11 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

I hit the link, first paragraph says:

Summary:
The Section 203(n) program insures loans for persons buying a unit in a cooperative housing project. The loan is made by a lending institution, such as a mortgage company, bank, or savings and loan association, and is insured by HUD's Federal Housing Administration (FHA).
  • March 11 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Norm, you keep linking to FHA's underwriting guidelines. Are you sure the folks shouldn't use the other links on this thread to a CLONE FHA site or to some RE writer dispensing misinformation? My bad, we don't know if it's misinformation because the link doesn't work. Maybe the CLONE site is referencing the 4511 handbook :>)
  • March 11 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

we've revived a 3 year old question?

The great news is the answer is the same as it was then,

Yes, FHA does insure co-op loans.

http://portal.hud.gov/hudportal/HUD?src=/programdescription/203n






  • March 11 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for NYC_MORTGAGE
That is correct. FHA loans cant be used for a co-op purchase. You can however purchase a 1-4 family property or a VA approved condo.

[weblinks removed by Zillow due to spam.  Please refer to our Good Neighbor Policy for details.]
  • March 10 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Empress219
I wasable to find this website from 2009 ...not sure how legit the guy is but it's worth a try if you or someone else is still looking to purchase a co-op.
  • July 23 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Empress219
All,
Please note that a lot of the websites being provided are outdated (one hasn't been updated since 2006).

I think you should inquire with an actual lender about the most current guidelines.  I was reading a recent article that there have been many changes since co-ops have become the more popular choice among urbanites.

Thanks!
  • July 23 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

I guess I've been admonished.

According to HUD.gov the 203(n) is alive and well, but you professionals know more than I do, most of the time I don't even remember what I had for breakfast.

  • May 09 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for jo815
FHA will not lend for a co-op...and  even some Homeowners Associations may be excluded.
  • May 06 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for robin398
Also,  please reference the FHA website where it clearly states the co-ops are ineligible.  Here is the link:

http://www.myfha.net/FHAguidelines/ineligible.html

Robin Lynch
Keller Williams Realty Group
  • May 05 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for robin398
Norm D. Plume,

You are incorrect.  If you were an agent or lender you would know the guidelines.  If you need a second opinion, please feel free to contact my associate who is an FHA Specialist covering the New York Metro area.

http://christianbabcock.com/

You can also reference the following article which clearly states that "FHA does not currently insure loans for purchases of co-ops".

http://therealdeal.com/newyork/articles/fha-loans-hit-speed-bumps

The reason being is that most co-op boards require more than 10% as a down payment.  The minimum downpayment for an FHA loan is 3.5%. 
 
Good Day.

Robin Lynch
Keller Williams Realty Group 
  • May 05 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

FHA loans do not cover co-op purchases.

Interesting that you said that; given that right below your post it's been pointed out that FHA has an entire set of guidlines on  doing co-ops.
  • May 04 2010
  • 1Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for robin398
Hi rmmike1890,

That is correct.  FHA loans do not cover co-op purchases.  To see which condos accept FHA loans, please reference the following link:

https://entp.hud.gov/idapp/html/condlook.cfm

Robin Lynch
Keller Williams Realty Group
  • May 04 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for SunTrust
Co-ops are ineligible property types for FHA.

One has to wonder then why FHA took the time to post guidelines for doing FHA insured co-op housing.  (handbook 4550.1).

Of couse the down side is that most lenders still won't touch co-ops except in certain metropolitan areas (such as New York City).


  • August 09 2009
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for rmmiki1890
i am trying to improve my credit rating and this seems the best way
to do it if I want to own something as oppsed to outright leasing as a tenant. If you have any ideas about high risk lenders, pls let me know.. Thanks
  • August 09 2009
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for rmmiki1890
thanks...
  • August 08 2009
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Ken Kopper
Co-ops are ineligible property types for FHA.

Best bet would be probably to google search "financing for co-ops"
  • August 08 2009
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.