The statement from the Veterans Benefits Administration reads: Effective immediately, site condominiums in the state of Michigan will be processed in the same manner as a single-family detached residence. VA will no longer review legal documentation for site condominiums. Lenders will be responsible for ensuring that any site condominium proposed as collateral for a VA-guaranteed loan meet requirements for the state of Michigan.
The hard work of the Home Builders Association of Michigan has paid off the ruling from the Department of Veterans Affairs has cleared the way for military veterans to now have access to affordable financing on condominiums.
“The VA’s willingness to modify their financing guidelines for single-family homes that are built in site condo developments is a game changer,” says Rick Holcomb, President of Mortgage 1.
Veterans earned the right to use their Veterans’ benefits to pursue the dream of homeownership. With this simple classification change, they have a wider selection of affordable options.
This classification allows developers to build neighborhoods faster and more efficiently. Mortgage 1 is proud of the work we have been doing with Michigan Veterans and look forward to providing more options to them in the future.
Prior to the new rule, veterans have been forced at times to use conventional financing when purchasing condominiums. Many have ended up not qualifying for a purchase because of the down payment requirements with that type of lending.
In the past, VA interpreted single-family homes in site condo developments here in Michigan as “condos” in their processing protocols. This triggered additional reviews that delayed and often eliminated VA financing for such homes because of the extended processing times.
The Michigan Condo Act also allows developers a more streamlined option for platting and developing a property for both traditional condominium projects and single-family homes. It is estimated that 90 percent of all single-family homes constructed in Michigan are built in site condo developments. Now they can be processed as single-family homes and would qualify for the VA’s single-family home financing programs.
Michigan Veterans will now have an easier time purchasing and financing single-family homes using a VA mortgage.