FHA-Approved Condos: A Buyer’s Guide

HUD's search tool can help you find FHA-approved condo complexes, but you can also get an FHA loan for a condo that's not in an approved development.
Profile photo of Kate Wood
Written by Kate Wood
Lead Writer
Profile photo of Michelle Blackford
Reviewed by Michelle Blackford
Profile photo of Dawnielle Robinson-Walker
Assistant assigning editor at large
Fact Checked
Profile photo of Abby Badach Doyle
Co-written by Abby Badach Doyle
Lead Writer
How to Find an FHA-Approved Condo-story

Some or all of the mortgage lenders featured on our site are advertising partners of NerdWallet, but this does not influence our evaluations, lender star ratings or the order in which lenders are listed on the page. Our opinions are our own. Here is a list of our partners.

Nerdy takeaways
  • Condos are an affordable, lower-maintenance option for first-time homebuyers or people looking to downsize.

  • To find FHA-approved condominium complexes, use HUD’s online search tool or ask a buyer’s agent to run a list.

  • It’s possible to get FHA financing for one condo unit that’s not in an approved community.

  • The FHA relaxed its rules in 2019 to make it easier to get a single unit approved. (Still, expect paperwork.)

There’s a lot to love about condos: For starters, they’re usually less expensive than standalone single-family homes. Upkeep is easier, since they’re smaller — plus, condo fees pay for help with maintenance. And if your credit score needs a little work, you can buy a condo with a low-down-payment mortgage backed by the Federal Housing Administration.

The rules for buying a condo with an FHA loan have changed in recent years. Here are a few shortcuts to help you start your search for an FHA-approved condo.

What to know about FHA-approved condos

The FHA is part of the U.S. Department of Housing and Urban Development (HUD). FHA loans are often attractive to first-time home buyers since they offer low down payments coupled with more lenient credit score and debt-to-income requirements than conventional mortgages. Buyers can get an FHA-insured mortgage for several home types, including single-family homes, duplexes and multifamily homes, manufactured homes and — yes — condos.

Did you know...

A condo, short for condominium, is part of a multiunit complex with shared walls among neighbors. You own your unit from the walls in but not the land underneath. Condo fees pay for maintenance and amenities in common areas.

There are two paths to buying a condo with an FHA loan: buying in a complex where all units are FHA-approved, or seeking approval for a single unit.

Buying in an FHA-approved complex

This used to be the only way to buy an FHA-approved condo — but not anymore. Still, it’s the most straightforward for buyers, since the pre-work is already done for you.

When you buy a unit in an FHA-approved complex, the owners of the condominium development have already submitted all the necessary paperwork to the FHA. This shows the FHA that the community is safe and viable, from its insurance coverage to the physical condition of the buildings.

Side note: A complex could have been approved before, but then let its paperwork expire. If that happens, you’ll have to go through the single-unit approval method listed below.

Seeking single-unit approval

What if the condo you want to buy isn’t in an FHA-approved development? Good news: You can apply through your FHA-approved lender for single-unit approval. This is sometimes referred to as "spot approval” or “spot loans,” although that term is technically outdated. The FHA relaxed its rules in 2019 to make it easier to get a single unit approved.

To get single-unit approval, your lender works with the complex's management or condo owners association to file paperwork with the FHA. This shows that the development meets basic FHA standards, even if it doesn’t have official approval.

Single-unit approvals are awarded on a case-by-case basis. If you go this route, leave yourself some wiggle room in your homebuying timeline for extra paperwork and back-and-forth. And you’ll definitely want to work with a lender that’s familiar with the ins and outs of FHA loans.

Explore mortgages today and get started on your homeownership goals
Get personalized rates. Your lender matches are just a few questions away.
Won’t affect your credit score

How to find an FHA-approved condo

HUD's condominium search tool is a quick way to see an FHA-approved condo list for your area. You can narrow your search by ZIP code, city, state or county.

If you’re working with a buyer’s agent, they can use the multiple listing service (MLS) to run a list of FHA-eligible condos in your area. Especially if you’re a first-time buyer, it helps to work with a buyer’s agent who’s familiar with the unique requirements for FHA loans.

Video preview image

Do you still need an FHA appraisal for a condo?

Yes. FHA approval for condos in FHA-approved complexes is similar to the process for an FHA-approved house. Even if the entire development has been OK'd, you'll still need an FHA appraisal to ensure that the individual unit you want to purchase meets the agency's standards.

An FHA appraisal is separate from a home inspection, but it ensures the property meets basic health and safety standards.

Get more smart money moves – straight to your inbox
Sign up and we’ll send you Nerdy articles about the money topics that matter most to you along with other ways to help you get more from your money.