FHA has once again removed the ability to do an FHA spot approval on condominium purchases. They seem to have gone back and forth over the past year. They took it away, brought it back and took it away again.
Here is one of the excerpts from a 2009 Mortgagee Letter from the Department of Housing and Urban Development:
"“Spot Loan” Approval Process
Mortgagee Letter 2009-46B eliminated the Spot Loan Approval Process as defined in Mortgagee Letter 1996-41 for all FHA case number assignments effective on or after December 7, 2009. However, to address concerns involving the volatility in the condominium market, the new effective date for the elimination of this practice is for all FHA case number assignments on or after February 1, 2010. FHA may…
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