FHA Certification

Our property manager, although willing to do what the board wishes, has suggested that many HOA's aren't getting certification done for reasons like:
Large esculating costs by lawyers to go through all the association documents etc.
The lending institution can do the certification thenselves if a buyer wants to purchase.
Because of the low down payment etc.buyers who get FHA loans are less likely to be able to pay the COA fees or any needed special assesment fees.
FHA gurantees payment to the bank but not to the association for fees.
I believe that we would meet the FHA guidelines but being an older association would probably require a huge lawyer bill (unknown amount)to research all our old documents etc.
We are a small association of 48 units,so we don't have extra money to spare and units sold last year without the need of FHA approval.Our board simply can't seem to decide what to do.
I would appreciate knowing your experiences or thoughts.

Well, the assesment is an unlikely situation because we do have adequate reserves for most emergencies and reserves to do major known repairs/replacements until 2015 ( unknown major electrical or water pipe repairs excepted). It was the other part concerning owners who get their loans through FHA maybe not haveing the funds to keep up with their monthly COA fees that had us most concerned.
We know that we qualify with the percentages etc but have been told that all of the old documents for the asssociation need to be reviewed by a lawyer to be sure that they were properly filed, stamped and recorded etc.
That is where the esculating lawyers fees seem to be coming from. Our buildings are 20 years old. We also have been told that the inital application for certification needs to be handled by a lawyer and that alone can cost $2,000.Reviewing the documents depends on many variables so is unknown.
This whole issue has come up while we were transfering from one management company to another and both companies have told us much the same thing.
Since we haven't, as yet, been having a problem with buyers being able to get a loan without going through FHA and the thought of a huge expense we are in limbo. We don't want owners to have more problems selling their units but also need to balance that with the cost to the other owners for teh certification. I was wondering how many of you have gotten the certification and what it cost to do it.

Thanks for your input Glen. My understanding from the HUD website, to get certification Hud requires copies of all origional documents, maps etc.
I have been unable to find out if a lawyer needs to verify that they have all been properly filed, signed and recorded. That part came from the two MC's.
I have been hoping to find someone who has actually completed this process. I called a couple of board members from other associations that I know in town and they also have not applied.
Putting that aside, I agree that because someone can't pay a larger downpayment doesn't always mean they wouldn't be able to pay both their mortgage and COA fees but our board felt that it does increase that posibility.
Again, thanks and I will try and contact HUD to see if I can get some clarification.

JoanneW2
Thanks for you input. I think that the board is using the "less likely be able to pay" as one excuse for not spending the money on the certification.
We do have a reserve study and put well more than 10% into our reserves each year to cover our projected major expenses and the percentage of owners vs renters etc is all within the guidelines.
I'm not sure if we are incorporated or not. That is an interesting point that didn't come up at the meetings.I will have to find out.Why would that make a difference ?
Our buildings are 20 years old and the developer did three different developements at about the same time ( I.E. DeerW1, DeerW2 and DeerW3) and we figure that he may have filed one set of paper work for all three. HUD has a listing only for DeerW.
Since we are completely seperate now, except in name, we imagined that could be quite costly to untangle.
We have not looked into having a company do this for us. I guess because we assumed they would be hiring a lawyer to do it anyway and it would be even more costly.
The other point that came up was the FHA guranteed the mortage but not the association fees.Do you know anything about that ?
We see the advantage of being certified but just don't want to get into a long expensive process.
Thanks.

Tim,
Thanks you are absolutly right. We were so busy looking at one aspect of this issue and didn't even think of the other problems that could be associated with it.I will bring this issue up at the next board meeting.