The Quick Read: On an FHA cash-out refinance, the building gets reviewed along with you. The condo questionnaire is the form that carries the building’s facts to the lender: owner-occupancy, unpaid dues, insurance, litigation. A strong borrower can still be stopped by a weak building. The exemption some pages mention for streamlines does not stretch to cash-out.
FHA cash-out estimate
Seeded with an example value, a balance to match, and a round cash request; change any field.
Editable benchmark: 7.40% as of October 15, 2026 · Freddie Mac 30-year average via FRED®. A conventional market reference, not an FHA cash-out refinance quote.
Illustrative starting assumptions: a $350,000 home value, a $193,000 current balance, the FHA cap on a principal residence with the upfront premium financed, a thirty-year term at the current Freddie Mac benchmark, and property taxes and insurance estimated at typical national rates. Every field is editable.
An illustration, not a Loan Estimate, an approval, a quote, or a commitment to lend. The rate shown is the weekly Freddie Mac thirty-year conventional benchmark, used as a market reference; an FHA cash-out is priced by the lender at lock, and this is not an FHA cash-out refinance quote. HUD’s cap limits the base loan; the upfront premium is financed on top of the capped base loan; the monthly premium for the first year follows the snapshot’s schedule. Cash available means the base loan the cap permits less the balances retired, before closing costs, which this calculator leaves out. The line figure applies the line program’s combined loan-to-value ceiling to the same value and balance. Taxes and insurance are estimates you can edit. Licensed in sixteen states for consumer mortgages.
What to Know Before Anything Else
- Cash-out on FHA reaches 80% loan-to-value on a home you have owned and occupied for 12 months before the case number.
- The condo has to be eligible at the project level or at the single-unit level. Your credit does not fix that.
- The association or management company supplies the project facts. The lender completes the form and files it.
- Ask about the building before you pay for an appraisal. That one habit saves the most money on these files.
- Every figure here is subject to lender guidelines and full file review. Nothing here is a commitment to lend.
What Does the Condo Questionnaire Actually Do on a Cash-Out?
It puts the building’s health on paper. The lender cannot judge a condo from your pay stubs, so the questionnaire records facts about the project: how many units are owner-occupied, how many owners are behind on dues, what the master insurance covers, and whether the association is in a lawsuit.
Many first-time borrowers assume the form belongs to purchases. It doesn’t. A cash-out is a brand-new loan, and the new loan has to sit on an eligible unit. Across the wholesale programs Lendmire places files with, the condo review is where cash-out files on condos get stuck, not the borrower review.
For the program basics, Lendmire’s FHA cash-out refinance program page covers the owner-occupied rules. The short version: it is for your principal residence, and it reaches 80% loan-to-value after you have owned and lived in the home for 12 months before the case number is assigned.
Approved Project or Single-Unit Approval: Which Path Is Yours?
Your condo is on one of two paths. Either the building is an FHA-approved project, or it is not approved and the single unit has to qualify on its own. HUD’s condominium page says FHA insures condo loans, purchase or refinance, in either situation. Project approval looks at insurance, financial condition, title, pending legal action, physical condition and marketability.
Approved project. The lender confirms the building’s status is current. Approval does not last forever, and an expired approval changes the path. The unit still gets a loan-level review of the questionnaire’s core sections.
Single-unit approval (SUA). The building is not approved, but the unit can still qualify. This path carries extra tests, including a cap on how many units in the building already carry FHA loans.
Approval routes also differ. HUD can review a project itself, which the Handbook glossary calls HRAP. A lender with delegated authority can review it instead, called DELRAP. You don’t pick the route. You just need to know why the lender is asking the association different questions depending on which one applies.
How the Condo File Moves, Step by Step
Here is the order of operations on a typical FHA condo cash-out.
1. Confirm you qualify as the borrower. Principal residence, owned and occupied for 12 months, decision score of 580 or higher on the wholesale programs Lendmire works with, and ratios that fit the file. The base pair is 31/43, and documented compensating factors can reach 40/50 at the top tier.
2. Identify the condo path. The lender checks whether the building is on the approved list or needs SUA. This should happen before you spend money on anything.
3. Ask the association for the project facts. The association or management company supplies them. The lender completes the questionnaire from those answers and takes responsibility for verifying them.
4. File the form with the case number. Per FHA Connection’s condo help page, the lender submits the form when it requests the case number for an SUA, and HUD reviews it. For an approved project, the form goes in the case binder.
5. Order the appraisal. The appraised value drives how much cash the 80% cap allows. Order it after the building looks eligible, not before.
6. Clear the borrower file and the building file together. Credit, income, payment history, insurance and the questionnaire all have to line up before the loan moves on.
Which Transactions Need the Form?
| Transaction | Condo questionnaire? | What to expect |
|---|---|---|
| Cash-out refinance | Yes, lender confirms path | Project or unit review applies |
| Rate-and-term with appraisal | Yes, lender confirms path | Same building tests |
| FHA-to-FHA Streamline | Not required per help page | No appraisal, limited credit review |
| Purchase | Yes | Same project or SUA path |
The streamline carve-out is the part that confuses people. HUD’s help page says the form is not required for FHA-to-FHA streamline refinances. A cash-out is not a streamline. The exemption does not carry over, and the page is dated, so the lender should confirm the current rule on your file.
What the Building Has to Pass
A building can fail even when every owner pays on time. These are the usual tests, and they are project facts you cannot change from your unit.
Owner-occupancy. The long-standing standard for existing projects is 50% owner-occupied. HUD has allowed lower levels in qualifying cases. The Federal Register final rule set a 30% floor on the range HUD can establish. “Owner-occupied” for this count is wider than you might expect. It includes principal residences, second homes, and units sold to buyers who plan to live there.
FHA concentration. For SUA, FHA-insured units in a project of ten or more units may not exceed 10% of the units. In a project with fewer than ten units, the cap is two FHA-insured units. If the building is already at the cap, SUA is off the table, no matter how clean your file is.
Unpaid dues. Owners in arrears is a standard question on the form. Approval standards also look at “financial distress events” such as bankruptcy or receivership of the association.
Insurance. The form carries extra insurance questions for SUA. It also notes a borrower-obtained walls-in policy (HO-6) where it applies. Stale or incomplete insurance documents from the association are a common reason a questionnaire gets sent back.
Litigation and physical condition. Pending legal action and deferred repairs can stop a project even when the finances look fine.
Commercial space and unit count. SUA has its own minimums. Secondary summaries of the rule describe a five-unit minimum and a limit on commercial space. The Handbook governs, so ask the lender for the current text rather than relying on a summary.
Cash-Out Math When the Building Clears
Once the condo is eligible, the borrower math is simple. The cap is 80% of the property’s adjusted value. Older, higher caps still appear on outdated pages. Ignore them.
Adjusted value matters when a unit changed hands recently. Per the Handbook glossary, for a property acquired within 12 months of the case number, adjusted value is the lesser of the purchase price plus documented improvements or the property value. That is one reason a recent buyer is usually not a cash-out candidate yet. The 12-month ownership and occupancy test comes first.
The appraisal is the swing factor. A low value shrinks the cash directly. If the number comes in light, the file may support reconsideration with recent in-building sales. Lendmire’s piece Can a First-Time Equity Borrower Challenge a Low FHA Cash-Out Appraisal? walks through how that packet is built.
Picture a first-time equity borrower with a unit worth a certain amount and a balance well under 80% of it. The cash is whatever room is left under the cap after the old loan is paid off and costs are covered. The financed upfront premium of 1.75% of the base loan also comes out of that room. Every cash-out file has to account for it.
Plan the use of the cash with care. Paying unsecured debt with home-secured debt turns a lawsuit-able balance into a foreclosable one. Balances on the cleared cards can also drift back up. If the plan is debt payoff, make the spending change part of the plan.
For the full list of what lenders ask of a borrower in this position, see Lendmire’s cash-out requirements for a first-time equity borrower.
Where the General Rule Breaks
- The streamline carve-out. Covered above. It does not apply to cash-out.
- Concentration at the cap. If the building is at its FHA limit and not fully approved, SUA is unavailable. A fully approved project can carry far more FHA loans.
- Lapsed approval. An approved project’s status can expire or change. The questionnaire facts get re-checked on each loan, so a building that cleared for a neighbor last year may not clear for you.
- Recent purchase. Adjusted value caps the value, and the 12-month test can rule out cash-out entirely.
- Policy changes. HUD has issued guidance aimed at making SUA case-number assignment smoother, and Handbook updates have stressed the lender’s responsibility to verify the form. Process details move. The lender’s current checklist governs.
- Conventional condo rules are separate. A building that fails conventional review may still work on FHA, and the reverse can happen. Do not carry one set of rules over to the other.
If the Association Is Slow or the Building Fails
The condo path adds work you don’t control. The association has to answer the questions. If the management company is slow, or wants to charge for the paperwork, the case number can stall, because the lender pre-clears SUA documents before HUD assigns one.
Practical moves:
- Ask for the questionnaire request in writing, through the lender’s contact at the management company.
- Ask the association whether it has current insurance certificates ready, since those are the documents that most often hold things up.
- If the building fails a test you cannot fix, ask the lender what else fits. That might be a different loan type, or waiting until the building’s numbers change.
- If the building’s status is the problem, don’t order the appraisal yet.
Some failures are fixable from the association’s side, such as updating insurance or resolving arrears. Others, like the concentration cap, are structural. Ask which kind you have before you decide to wait.
A First-Timer’s Pre-Check
Before you apply, ask the management company:
1. Is the project FHA-approved, and when does the approval expire?
2. Roughly what share of units is owner-occupied?
3. Are there owners significantly behind on dues?
4. Is there pending or threatened litigation?
5. Is the master insurance current and complete?
6. Are there large repairs or special assessments planned?
You won’t get perfect answers. But a vague response to question one or two tells you to pause before paying for anything.
Key Terms Defined
Condominium questionnaire (HUD-9991): The loan-level and single-unit approval form that records the building’s facts for the file.
Single-unit approval (SUA): A way for one unit in a non-approved building to qualify for FHA financing if the project passes certain tests.
Concentration limit: The cap on how many units in a building can carry FHA loans.
Adjusted value: The value FHA uses to size a refinance, which can be lower than the appraisal on a recently acquired home.
HRAP / DELRAP: The two project-approval routes. HUD reviews HRAP projects itself. A lender with delegated authority reviews DELRAP projects.
Arrears: Owners who are behind on association dues.
Frequently Asked Questions
Do I need the condo questionnaire for an FHA cash-out refinance?
Expect to need it. A cash-out is a new loan on the unit, so the building has to be eligible. The only carve-out found in HUD’s help page is for FHA-to-FHA streamlines, and cash-out is not a streamline. Your lender confirms the current requirement on your file.
Who fills it out?
The association or management company supplies the project facts, and the lender completes the form and files it. You are the go-between more than the author. The lender is responsible for verifying the answers.
What if my building isn’t FHA-approved?
Single-unit approval may still make the unit eligible. The building has to pass the SUA tests, including the cap on FHA-insured units. If it is already at the cap, that route is closed and the lender can talk through other options.
Does the association charge for the questionnaire?
Some associations or management companies do charge for paperwork, and some don’t. Ask early. Whether a fee applies is between you and the association, and the lender can tell you what documents it needs.
Can a low appraisal change my plan?
Yes. The appraised value feeds the 80% cap, so a lower value means less cash. Plan for that before you commit the funds, and don’t count on the full amount until the appraisal is in.
Next Step
If you are weighing a cash-out refinance against keeping the loan you have, Lendmire can help you compare the programs and the equity each one reaches. Lendmire is a mortgage broker that arranges FHA loans through wholesale lenders, and every parameter here stays subject to lender guidelines and full file review.
For your own numbers, request a scenario review with Lendmire.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Lendmire arranges FHA, VA, conventional and jumbo purchase and refinance loans through wholesale lenders; every file is underwritten by the lender under the applicable program guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
2. HUD Handbook 4000.1 Glossary
3. FHA Connection condo help page
4. Federal Register, Project Approval for Single-Family Condominiums
This article is part of Lendmire’s FHA Loan series — every loan program’s qualification details, guidelines, and scenarios live on the loan options page.
Related reading: How to Get a Condo Project Onto the FHA List for a Cash-Out · How to End Mortgage Insurance After an FHA Cash-Out on a Condo · Conventional Cash-Out vs FHA Cash-Out on a Condo
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosures. The information presented in this article is general market commentary, not financial, legal, or tax advice. Lendmire is a mortgage brokerage (NMLS# 2371349) — not a direct lender or depository institution — and loan placement is subject to lender underwriting. Nothing in this content represents a commitment to lend. Loan terms, pricing, and program availability vary based on borrower qualifications, property characteristics, and state of subject property, and are subject to change at any time. Lendmire complies with Equal Housing Opportunity requirements. Consumer access: nmlsconsumeraccess.org.