Getting VA Loan Approval for a Condo


The VA Condo Approval Process

There is a process for listing a condominium on the VA Approved Condominium List. If the condominium you want to buy in is not on the VA Approved Condominium list or is listed as “rejected,” there is a process to get it approved.

If the building has been refused or approved with conditions: If your condominium building was rejected by the VA or approved but with conditions, moving the building to “approved” status can be simple.

Sometimes the staff at your local VA Regional Loan Center just needs to update the condominium listing. Other times, the Department of Veterans Affairs may request additional information from the condo building’s board of directors, such as a list of officers, a copy of the condo’s bylaws, or documentation proving that the building has a reserve fund large enough to cover maintenance or future repairs.

The condo board may need to address more serious issues to move a building from VA “rejected” to “approved.” The condominium owners’ association may need to change a section of its governing documents, build its cash reserves, or remove restrictions on the resale of units. In other cases, they may have to pay for major improvements to the foundation, roof or other areas of the building.

If the building’s status on the VA Approved Condo List is anything other than “Accepted Without Conditions”, contact your local regional lending center and ask a representative what steps need to be taken to move the building to “Approved” status.

If your building is not on the list of approved condos: If your condo project is not on the VA’s list of approved condominium buildings, you will need to start the application process to have the building listed.

Your local regional loan center accepts and reviews applications for condo project approval. Fortunately, the application process is relatively simple: gather the required co-ownership documents, submit them to the Regional Loan Center with your details, and wait for the loan center’s decision.

The easiest way to do this is to have your lender submit the documents and start the process. Note that the condominium association is not required to provide these documents to you or your lender.

Documents Needed for VA Condo Approval

Often the biggest challenge is gathering the required documents. Help is available from the condo association, your county clerk, and the regional loan center. Here are the documents you may need to provide:

  • Registered declarations of co-ownership (commonly called CC&R) or main deed
  • Registered project plans (plans showing property division) and/or condo site plan
  • Registered statutes
  • Signed copy of the co-ownership regulations
  • Minutes of the last two HOA meetings
  • Budget and co-ownership balance sheets

Your local regional loan center will also need to see a statement from the HOA, answering the following questions:

  • Are there any special assessments underway or planned?
  • Is the project involved in any ongoing or pending litigation?
  • Is the construction of the project finished?
  • How many units of the project have the developer sold?

The Regional Lending Center will review the documents. If something is missing, the representatives of the center will ask for additional documents.

Once you have provided all of the necessary documents, the loan center staff members will send the application to their attorney, who will review the documents to ensure that the project meets VA loan guidelines. The full review can take up to 4 weeks, depending on the activity of the regional lending center.

Once the VA has decided, the representatives will contact you (provided you have given them your contact details) and let you know of their decision. If all goes well, you will now be able to find your project on the list of VA approved condos, which means the condo building is now eligible for VA loans.

Common Reasons the VA Turns Down Condos

The VA refuses condominiums for several reasons:

  • A lot of condo owners might be behind on their monthly homeowners association fees.
  • The building might have too many units filled with tenants instead of owners.
  • One person, or one financial institution, may own too many units in the building.
  • There may be too many vacant units in the building.

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