FHA Moves to Boost Condo Market

Nov. 11--The Federal Housing Administration is giving the condo market something it hasn't had for a while -- a little breathing room. Last week, the FHA, the federal agency that insures low-down-payment home loans for private lenders, said it was relaxing its building underwriting guidelines as a way of helping the struggling sector ride out the downturn. The move could help boost sales in condos by making more FHA mortgages available to borrowers. "The best way to bring back some level of security is to get new buyers into those vacant units. You can't do that until new homeowners have access to financing," said Meg Burns, director of the FHA's single-family program development. The new rules -- which are temporary -- come after more than a year of more stringent standards from lenders, who, after suffering major losses on condos, began vetting and disqualifying condominium projects for purchase loans, regardless of whether home buyers qualified.

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