Last reviewed: September 25, 2026 · Chicago Condo Loans Editorial Team · How we research
Quick answer: To use an FHA loan on a Chicago condo, the building must be on HUD’s list of FHA-approved condominiums, or your lender must get the individual unit approved through FHA’s single-unit approval. You can check a building’s status for free on HUD’s condo search. In 2026, the most you can borrow with an FHA loan on a one-unit property in Cook County is $541,287, and the minimum down payment is 3.5% with a credit score of 580 or higher.
This is part of our complete guide to condo loans in Chicago.
Two ways to get FHA approval
| FHA project approval | FHA single-unit approval | |
|---|---|---|
| What’s approved | The whole building | Just the unit you’re buying |
| Who requests it | Usually the association or its management company, through an FHA lender or consultant | Your lender, during your loan |
| How long it lasts | 3 years, then the building must be recertified | Your loan only |
| Building size | Any eligible condo project | At least 5 units |
| FHA loan cap | A limit on the share of units with FHA loans applies | In buildings of 10 or more units, no more than 10% of units can be FHA-insured; in buildings under 10 units, no more than 2 |
| Best for | Buildings that want to attract FHA buyers long-term | Buyers whose building isn’t on the list but otherwise meets FHA standards |
How to check if a Chicago condo is FHA-approved
- Go to HUD’s FHA-approved condominium search.
- Search by state (IL), city (Chicago), and the building’s name or ZIP code. Buildings are often listed under their legal association name, which may differ from the building’s common name. Your 22.1 disclosures or the declaration will show the legal name.
- Check the status and expiration date. Only an “Approved” status that hasn’t expired counts. “Expired,” “Withdrawn,” or “Rejected” means the building isn’t currently approved.
- If the approval expires before your closing, ask the association whether it has started recertification.
- If the building isn’t listed, ask your lender whether single-unit approval is possible.
What FHA requires of a condo building
Whether for project approval or single-unit approval, HUD looks at the building’s finances, occupancy, and legal setup. Key standards:
- Owner occupancy: generally at least 50% of units must be owner-occupied.
- Reserves: the budget must set aside at least 10% for replacement reserves, or the association can show a current reserve study.
- Delinquent dues: no more than 15% of units 60 or more days behind on assessments.
- Single-owner concentration: generally no one person or entity owning more than 10% of units.
- Commercial space: generally no more than 35% of the building’s floor area.
- Insurance: adequate hazard, liability, and fidelity coverage, plus flood insurance if the building is in a flood zone.
- Litigation and financial distress: lawsuits and events such as a bankruptcy or foreclosure involving the association must be disclosed and explained.
- Legal documents: recorded declaration and bylaws that comply with Illinois law and don’t contain restrictions FHA prohibits.
For single-unit approval, the lender uses HUD’s condo questionnaire (form HUD-9991) along with the budget, insurance documents, and legal documents. Delays in getting the questionnaire back from a management company are one of the most common reasons FHA condo purchases slow down.
FHA vs. conventional for a Chicago condo
| FHA | Conventional | |
|---|---|---|
| Minimum down payment | 3.5% (credit score 580+) | 3%–5% for a primary residence, depending on program |
| 2026 Cook County loan limit (1 unit) | $541,287 | $832,750 |
| Mortgage insurance | Upfront premium of 1.75% of the loan (can be financed) plus an annual premium, commonly 0.55% for a typical 30-year loan with less than 5% down | Private mortgage insurance if under 20% down; can be removed as equity grows |
| Mortgage insurance duration | Life of the loan with less than 10% down; 11 years with 10% or more down | Typically removable around 20%–22% equity |
| Building approval | FHA project or single-unit approval | Warrantable under Fannie Mae or Freddie Mac rules |
| Credit flexibility | More flexible on credit scores | Pricing improves with higher scores |
Price ceiling example: with the minimum 3.5% down, the $541,287 FHA limit means the highest purchase price you could finance is about $560,900 before the upfront mortgage insurance premium. Above that, you’d need a bigger down payment or a conventional loan.
The two systems are independent. A building can be FHA-approved but non-warrantable for conventional loans, or the reverse. See warrantable vs. non-warrantable condos.
Why some Chicago buildings aren’t FHA-approved
- The approval lapsed. Project approvals last three years. Some associations don’t recertify, often because no one on the board is tracking it.
- Too many renters. Buildings below 50% owner occupancy can’t meet FHA’s standard.
- Thin reserves or high delinquencies. The same financial issues that trouble conventional lenders.
- The board never applied. Approval is voluntary, and some associations don’t pursue it.
- Too small for single-unit approval. Buildings with fewer than 5 units can’t use single-unit approval.
If you own in a building that isn’t approved, raising FHA approval with your board can widen the pool of buyers when you sell.
Frequently asked questions
Can I get an FHA loan on a condo that isn’t on HUD’s list?
Possibly, through single-unit approval, if the building has at least 5 units, meets FHA’s standards, and hasn’t already reached its cap on FHA-insured units.
How long does FHA single-unit approval take?
It depends mostly on how quickly the association returns the questionnaire and documents. Build extra time into your financing contingency.
Is an FHA-approved condo also VA-approved?
No. FHA and VA approvals are separate. Check each program’s list.
What’s the maximum FHA loan for a Chicago condo in 2026?
$541,287 for a one-unit property in Cook County, per HUD Mortgagee Letter 2025-23.
Does the August 2026 Fannie Mae change affect FHA loans?
No. The end of limited review applies only to conventional loans sold to Fannie Mae and Freddie Mac.
Sources
- HUD: FHA Condominiums
- HUD FHA-approved condominium search
- Federal Register: Project Approval for Single-Family Condominiums (2019 final rule)
- HUD: FHA single-unit approval required documentation
- HUD Mortgagee Letter 2025-23: 2026 FHA loan limits
Educational content only, not lending or legal advice. See our Disclaimer.