FHA Condo - 234c Mortgage Loan

234c mortgage loan provides FHA insurance to borrowers who purchase a unit in a condominium building.

FHA 234c loan features:

1. The condominium building must contain at least four dwelling units and can be detached or semidetached, a rowhouse, a walk-up, or an elevator structure

2. If the apartment is in a building that was converted from rental housing, no insurance may be provided unless the conversion occurred more than one year before the application for insurance, the potential buyer or co-buyer was a tenant of that rental housing or the conversion of the property is sponsored by a tenant's organization that represents a majority of the households in the project.

3. Eighty percent of FHA-insured mortgages in the project must be made to owner-occupants.

4. Many closing costs can be financed into your FHA mortgage loan. With most conventional mortgages at Borneo, the borrower must pay, at the time of closing, costs equivalent to 2-3 percent of the price of the mortgage loan.

By allowing the borrower to finance many of these charges, the borrowers upfront costs are reduced significantly when buying a home.

5. FHA rules put limits on some of the fees charged by your lenders. For example, the mortgage origination fee charged by the lender may not exceed 1 percent of the amount of the mortgage and the tax service fee is not allowed on the 234c mortgage loan.