New Rockaway Condo Gets FHA Mortgage Approval
That is the reality of life in Rockaway, even in a market where house and condo prices are falling, although not as far or as fast as some other areas.
Take couple A, who asked not to be identified by last name.
Karen is a teacher and has been at it for nearly 12 years. She makes a nice salary, in the $80,000 range and will earn more than $102,000 when she reaches maximum in a few years.
Bill, her husband, is a captain in the New York City fire department. With his overtime and his ability to work a second job as a plumber, he earns a little more than his wife.
That means the couple earns more than $150,000 a year, which at one time would have been considered a kingly sum.
Today, however, according to the statistics, that intake barely makes them middle class, and with two kids to feed and clothe, they save very little.
For the first time in Rockaway, however, people such as Karen and Bill may be able to find a mortgage for a condominium unit that requires little money down, thanks to the fact that the Federal Housing Administration has approved a large, new condominium project for its mortgages.
In fact, the certification of Belle Shores Condominium allows the company to offer FHA mortgages, and it is reportedly the first time in more than a decade that the federal agency has agreed to make its funding available in New York City to a brand new operating condo development with more than six units.
The FHA involvement makes it possible for couples like Karen and Bill, who lack a downpayment, but can afford to pay the monthly mortgage and other costs, to get a mortgage that pays 96.5 percent of the total. That leaves the couple to come up with only a 3.5 percent down payment on a new condominium home.
The FHA was created by the federal government to make home ownership more affordable by holding initial costs down, and that is what is happening in Rockaway, experts say. How does this differ from the no-check mortgages that helped the United States into the economic mess in which it now finds itself?
These new owners lack a downpayment, but can afford to pay the mortgage, and will most likely never go into default or bankruptcy.
"We are thrilled to receive approval to offer FHA financing for the Belle Shores Condominium," says Michael Kerris, the chief financial officer for the FrameWorks Group, the company developing Belle Shores. "With such incredible financing options, the opportunity to purchase beachfront real estate at an affordable price is an option for many homeowners."
Kerris says that 60 percent of the condos at Belle Shores have already been spoken for, and he expects the rest to go quickly once the availability of the FHA mortgages becomes widely known.
One local real estate professional, who asked not to be identified, said that the insertion of the FHA could "turn the real estate market in Rockaway on its head," because many first time home buyers would not have to come up with the traditional 20 or 30 percent down payment in order to own a home or condominium.
"This could be a big break for the local housing market," the broker said. "And you can bet that we need a shot in the arm just about now."