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e. Two- to Four-Unit Condominium Project (10/15/2019)
i. Definition
A Two- to Four-Unit Condominium Project refers to a Condominium Project that comprises of at least two, but no more than four, one-family dwelling Units that are each separately owned with separate legal descriptions.
ii. Standard
All general FHA Condominium Project Approval requirements are applicable except:
• if state law does not require the creation of an annual budget or annual financial statements, a signed and recorded memorandum of understanding may be provided in lieu of the financial documents. The memorandum of understanding must define the individual Unit owner’s responsibilities for maintenance/repair/replacement of common areas including sidewalks, driveways, and common walls (includes side by side or vertical type Units) and must provide for a procedure for splitting any shared maintenance costs;
• the project must have an Owner Occupancy Percentage of 75 percent owner- occupied; and
• no Units in Arrears.
iii. Required Documentation
The following documents must be submitted:
• documentation of the verification of compliance with the Two-to Four Unit Condominium Project requirements;
• annual budget, financial statements or memorandum of understanding if applicable; and
• documented evidence that each Unit is separately owned with a separate legal description.
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II. ORIGINATION THROUGH POST-CLOSING/ENDORSEMENT C. Condominium Project Approval
3. Project Approval Submission