Special thanks to our good friend Megan Speno for this information! All credit to her. Follow her on Instagram here.
CONDO INSURANCE BASICS
Condo dwellers and potential purchasers should take time with their insurance agent to become educated when obtaining condo insurance—there are nuances that they need to be aware of upfront. The policy should protect what the condo association doesn’t. Condo buildings each have a master policy that will cover reconstruction of the building to the original form if a disaster should occur, this includes interior permanent fixtures and is required by law in the state of Georgia. Master policies have large deductibles which are commonly shared by all owners. Customers will need coverage for the shared deductible plus any damage they may cause to other units, liability, and personal belongings. Individual unit coverage is referred to as an HO6 policy. Liability insurance is also extremely important—both included in the master policy as well as individual unit. Learn amounts, what each policy covers and does not as well as what you as an individual owner could be liable for.
FHA CONDO APPROVAL
Affordability for homeowners is more difficult, conventional condo approvals are becoming tougher, portfolio lending is tight for non-warrantable condos and other products. We are currently facing these temporary challenges in the housing market. A way to protect the value of a condominium community is to apply for FHA approval or HRAP(ASSOCIATIONS) or DELRAP(LENDERS). Opening the building to more potential buyers and ease of loan approval is essential. Once on the approved list, most lenders require a copy of the insurance and appraisal. The current FHA loan limit for FHA in Atlanta metro is $595,250.00. Most condo buildings fit within this range. Almost all in town buyers in this range are looking for condos. Once the building is approved, it remains on the approved list for two years and can easily be renewed prior to expiration. The HOA management company and/or members of the board can apply for approval. The process can take 4 to 6 weeks.
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