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Thanks SmartMoney. I'm buying on a conventional loan not FHA and I know about what their master policy covers but I was asking out of curiosity. Not about why they made the decision or what the designation means for their insurance.
I was asking only whether or not they're allowed to make the decision to reject purchases based on FHA financing but not make that decision public so that FHA buyers don't waste their time going through the process of bidding, going under contract, and all of that only to be turned away by the board/HOA.
It seems like they're not making this public so that the condos will still attract FHA buyers just for the purpose of generating a lot of traffic and interest in the condos even though in the end, none of the buyers who can only qualify for an FHA loan will be given the right to purchase.
So I was just asking in concern for the time and money FHA buyers will be wasting on properties they have no chance of buying but don't know that because the HOA/board is being hush hush about their decision to do a blanket rejection of all FHA buyers since this is something I never heard of before.
To me, it's like if I was having a talent show and I put out an ad saying, "Talent show! Great opportunity for dancers! Dancers wanted in this great venue! Come on down and sign up to be considered to participate!" But I already know that I'm not going to accept any dancers into the talent show, only singers, because I don't want to pay for the extra stage space to accommodate dancing.
If someone found out that I made that decision, I'm sure they'd say, "If you already know you're gonna reject dancers, why are you advertising to dancers? Why even bother? Why waste their time? Why not just say 'singers only' or at least leave the word 'dancers' out?"
And I think they'd feel it wasn't right. In this case with the condos, I also had to wonder if it was legal.
In my area alone, we have over 6000 real estate agents that put listings in the computers. They are not going to be familiar with the intricacies and nuances of every listing in a condo project. Most will learn by fire, meaning when their deal kicks out or someone in their office gets burned and makes a whole lot of noise. Out of all the listing agents out there, only a fraction are making real estate a full-time career (granted, it's a larger fraction with the crisis). The HOA has nothing to do with marketing properties and this issue is really in their lap. Maybe that is your disconnect. The listing agent doesn't realize there's a problem, or they found out during the listing. In theory, if they know, they should put "not FHA eligible." My money is on most do not know, and then when they found out, they left things as is, with hopes of not driving the purchase traffic down.
I see, thanks! I'm with you on them probably not knowing.
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