Spaces:
Running
Running
# II. ORIGINATION THROUGH POST-CLOSING/ENDORSEMENT
## C. Condominium Project Approval
### 2. Project Eligibility
#### (3) Required Documentation
The following documents must be submitted:
- Form HUD-9992; and
- Recreational Leases, Easements, or contracts for use of recreational facilities.
## (D) Litigation
### (1) Definition
Litigation refers to a current or pending lawsuit or proceedings in a court, arbitration, or mediation involving the Condominium Project or Condominium Association, or those concluded within 12 months of the application date. Litigation does not include foreclosure or actions to collect past due assessments brought by the Condominium Association or Condominium Project as plaintiff.
### (2) Standard
The Condominium Project or Condominium Association must not be subject to pending Litigation in which the project sponsor is named as a party that relates to the safety, structural soundness, habitability, or functional use of the Condominium Project.
The Condominium Project or Condominium Association must not be subject to any other Litigation risk not covered by insurance or that exceeds the amount of insurance coverage relating to the potential losses for that matter.
### (3) Required Documentation
The following documents must be submitted:
- Form HUD-9992;
- A signed and dated explanation from the Condominium Association, management company, or an attorney representing the Condominium Association that includes at least the following information:
- Reason(s) for the Litigation;
- Risk of the Litigation;
- Anticipated settlement/judgment date, if any;
- Sufficiency of insurance coverage to pay out a settlement/judgment, if applicable; and
- Impact of the Litigation on the future solvency of the Condominium Association; and
- The following documents, which must be attached to the signed and dated explanation, if applicable:
- Complaint filed with the court, arbitrator, or mediator.
---
**Handbook 4000.1**
**804**
**Last Revised: 01/10/2025**