A Short Guide to VA Approved Condos in Miami

It only makes sense that those who have served our country get some perks and benefits to make life easier. A VA home loan is one of those benefits. It is the best kind of mortgage available, since it requires no down payment (up to a certain limit), no mortgage insurance, has low interest rates, low closing costs and is easier to qualify for than any other type of loan available. United States veterans can use their VA home loan to finance a condo, townhome, or single-family home. However, financing a condo comes with a little twist.

Since you can only use your VA home loan to finance a VA-approved condo, here are a couple of things you should know:

We’ve included a complete list of VA-approved condos in Miami at the end of this article to give you a headstart on your home owning process. If you want to see a list of VA-approved condos in Miami, jump down here :)

Cité - Edgewater, Miami FL

What is a VA Approved Condo?

A condo development submitted to and approved by the Department of Veteran Affairs will offer VA approved condos. This approval is given to entire condo projects, so veterans can choose to finance any condo unit from within the building.

As of the writing of this article, you will only be able to buy into a condo using a VA loan if the condo has been VA approved.

How Can You Get a Condo VA Approved? 

Previously, spot approvals for condos used to be allowed, wherein even a single condo from a project could be VA approved. However, this was recently cancelled by the HUD (although proposals have been submitted by the Federal Housing Administration to bring the system back). So, for now, approvals are only given to entire complexes. And the condo association will need to take an active role in submitting all the documents required for VA condo approval. Because of this, it really isn’t possible to get a single condo unit approved if the building is not VA-approved. 

See a list of VA approved condos in Miami at the bottom of this blog.

The Loft I - Downtown, Miami FL

Basic VA Condo Approval Guidelines

For a condo building to be VA approved, it must meet the following criteria (among other criteria):

• It should have at least 35% owner occupied units
• There should not be more than 10% of units that are 60 days delinquent on their HOA
• The complex/building must have 20% of its condo budget in reserves for maintenance
• All units must be covered by flood, hazard, liability plus any other insurance dictated by the State Law and acceptable by the HUD
• There should be three years of acceptable financial documents from the HOA
  

Types of VA Approved Condos

Accepted without Conditions – This means that the condo complex has been reviewed by the VA and is eligible for VA financing.

HUD Accepted – Before December 2009, condo projects approved by the HUD/FHA did not require a separate VA approval. However, post this change, it was declared that a condo development with such a prior approval would be "grandfathered" in and accepted as a VA approved condo project. In other words, an already HUD-approved project before December 2009 would not need to go through the VA approval process again. However, it is still advisable to verify the status of such a complex.

Unaccepted/Rejected – This means that units in the condo complex are not eligible for VA financing. There could be three reasons for such a status:

• The condo community has never undergone the VA approval process
• It does not have a pre-2009 HUD accepted status
• It was submitted for review, but was denied by the VA
  
  

Quantum on the Bay - Edgewater, Miami FL

What is the VA Loan Limit in Miami, Florida and South Florida?

The VA home loan program, much like other zero down programs, has a set loan limit, beyond which you will need to put some money down. The VA loan limit in Miami-Dade for 2021 is $548,250. If you are able to provide a down payment, there is no maximum loan limit provided you can afford the loan. This means that if you are planning to purchase a higher-priced condo in Miami, you will be required to make a down payment on top of your existing VA entitlement.

Can I Get a VA Loan for a Condo not on the Approved List?

If the condo you like is not currently VA approved, your lender will have to get it passed before you can finance it with a VA home mortgage. For this, your lender will need to get the requisite documentation from the condo association (which it is not liable to share) and submit it to the VA. Also, do remember that this is a long process and could take a few months. So, we highly recommend looking at already approved condo projects.

The Charter Club - Edgewater, Miami FL

Why Aren’t There More VA Approved Condos in Miami and South Florida (and in General)?

There are two main reasons why there aren’t more VA approved condos in South Florida. Many condo buildings vote down fully funding the reserves fund (essentially a savings account for future major repairs/replacements) in order to keep their monthly association fees lower. This goes against the reserves requirements required for VA condo approval. Second, many condo associations do not take the initiative to go through the VA approval process.

What are my alternatives to a VA home loan?

At times, it could be beneficial for a military borrower to look at options besides a VA home loan. This could be because they didn’t qualify, want to buy a second home or rental property, want to buy an expensive property, can afford putting 10-20% down, are looking to undertake renovations and need a flexible program, etc. In such cases, your options include:

• FHA mortgages
• USDA mortgages
• Conventional mortgages

This article gives you detailed insight into the above options and how they compare to a VA home loan.

Yacht Club at Portofino - South Beach, Miami FL

List of VA Approved Condos in Miami

We’ve put together this handy checklist of Miami’s VA approved condos to help you on your journey to becoming a condo owner:

If you are a U.S. Veteran and want to purchase a condo with a VA loan, let us know and we will be honored to help you find your perfect home. Call, email or chat with us anytime.