The most common rejection we see from the VA is unacceptable leasing/rental rules in the governing documents. About 10% of the condominiums we review do not meet VA rental restrictions. For instance, condos in the State of Florida rarely comply due to their strict leasing policies.
Leasing Restrictions in the declarations must comply with the following:
- The HOA must allow for leasing in the community
- No “Seasoning Clauses” (A restriction that requires a unit owner to occupy the unit for a specified time period before they can lease) Some circumstances with hardship clauses may be OK, but it’s case-by-case
The Board of Directors cannot have the power to:
- Approve leases or deny leasing. The unit owner must have the right to lease to any tenant
- The Board cannot Impose background checks, credit checks, or any other type of screening for prospective tenants. The unit owner may impose these checks, but not the HOA or Board of Directors. (Most of the condominiums that we review in Florida do not qualify for FHA approval for this reason.)