By a vote of 427-0, the U.S. House of Representatives advanced legislation last night to expand opportunities for homeownership. H.R. 3700, the “Housing Opportunity Through Modernization Act,” includes a number of initiatives that have strong support from the National Association of Realtors®.
In a news release following the vote, NAR President Tom Salomone highlighted sections of the bill designed to reform current Federal Housing Administration restrictions on condominium financing.
“There is tremendous demand for affordable housing, and H.R. 3700 offers fresh opportunities for creditworthy borrowers to become homeowners when they choose to,” said Salomone.
Salomone noted that condominiums are often a highly affordable option for first-time homebuyers, as well as lower income borrowers. Unfortunately, existing barriers to safe, affordable credit make it more difficult for prospective buyers to get a mortgage on a condo.
Among the bill’s condo provisions, H.R. 3700 would make FHA’s recertification process “substantially less burdensome.” This is an often costly process for condo developments, who must repeat their re-certification every 24 months.
Additionally, the bill lowers FHA’s current owner-occupancy requirement from 50 percent to 35 percent, which is one of many provisions that NAR testified in support of before a House Financial Services Subcommittee last year. The bill also requires FHA to replace their policy transfer fee policy with a less-restrictive model.
Finally, the “Housing Opportunity Through Modernization Act” would make it easier to win an exemption to FHA’s rule against certifying condominium projects with more than 25 percent of their space dedicated to commercial use.
Having now passed the House of Representatives, the bill must now also pass in the Senate before it can be sent to the President to be signed into law.
“This legislation will put homeownership in reach for more families,” said Salomone. “NAR thanks Congressman Blaine Luetkemeyer, R-Mo, for introducing the bill, as well as leaders in the House for making it a priority. We look forward to working with our partners at all levels to advance this legislation in support of homeownership.”