FHA Loans New Info in 2019

In a serious step three years in the making, the Federal Housing Administration announced Wednesday that it shortly will back some mortgages on individual condominium units in condo complexes that are not approved by the department.

In the past, buyers generally could not get an FHA-backed loan on a condo unit unless the whole complex had FHA approval, but just 6.5% of the approximately 150,000 condo complexes in the country had that approval. In San Francisco, just 17 complexes have been approved.

The new approval process is part of a rule mix that will take effect Oct. 15. The objective is to increase owning a home among low-income, minority and new buyers, and seniors wanting to downsize. Often, these buyers see condos as an affordable option, but don’t have the down payment, credit score or other qualifications needed to get a conventional loan backed by Fannie Mae or Freddie Mac. They could qualify for an FHA loan, but can’t get one on a condo because the project is not FHA-approved.

Under the new guidelines, they may be able to. For projects that are lacking FHA approval, the department will insure up to 10% of individual units in projects with 10 or more units, and up to two units in projects with fewer than 10 units.

There still will be a limited review of the project to make sure it has sufficient reserves and meets owner-occupancy and other requirements.

Generally, the project would need at least 10% of the complex’s total monthly unit assessments in reserves, and would need at least 50% of the units occupied by owners. Those are the same requirements FHA imposes on entire complexes today.

The new rule, however, also makes changes to FHA’s approval process for entire complexes to make it more simplified and flexible. For example, under the new rule, FHA could adjust its owner-occupancy requirement to anywhere between 30% and 75%.

Let There Be Light (Emitting Diodes): Philly to Retrofit All 100,000 City Streetlights

The town of Philadelphia has a great many plans to decrease its municipal energy consumption in the name of staving off climate change. These include ambitious but clear initiatives like purchasing more renewable energy and creating more electric cars. But it turns out, when it comes to how much the city pays on its own power bill, the single largest culprit is something both common and taken for granted: streetlights.

Our approximately 100,000 sodium-powered bulbs expense $15 million to light each year. Which is why, after experimenting with some pilot programs beginning in 2011 that replaced 5,000 sodium bulbs with more energy-efficient LEDs, the city has promised to scale up the whole effort and exchange all of its 100,000 streetlights, along with another 18,000 alley lights.

Philly’s been a bit sluggish on the uptake here — many other places, like New York City and Chicago, have already retrofitted their lights. But for once, our measured pace may actually be an advantage. That’s due to the fact many of the early LED installations from the early 2010s had just one setting — hyper bright — and were quickly were met with public outcry as residents complained about blocks now suddenly lit like hospital operating rooms. Technology has since improved to the point that there are dimmer LEDs available.

Despite those improvements, some concerns over LEDs have remained — in large part thanks to a 2016 report from the American Medical Association that suggested certain LEDs, with their blue-light wavelengths, could hurt people’s eyes. Sodium-powered lights, on the other hand, typically fall in the more eye-friendly yellow-light spectrum.

The AMA’s report also referenced, quite ominously, “a long-term increase in the risk for cancer, diabetes, [and] cardiovascular disease” that could be caused by bright lights disrupting people’s circadian rhythm. But it seems even the AMA thought that was a bit over-dramatic, due to the fact in the end, the doctors still endorsed LED retrofitting, so long as cities use less powerful lights. (The AMA suggested lights no more powerful than 3000K, a unit of “color temperature” for which higher figures signify more blue wavelengths. While most of Philly’s existing LEDs are at the 4000K level, the city is also testing 3500K, 3000K, and 2700K models.)