“Secret Condo List”: Tools for savvy condo buyers in a challenging loan market

The Secret Condo List: Tools for savvy condo buyers in today’s challenging loan market

Financing condos in today’s market is no easy feat. With the cost of single family homes skyrocketing in South Florida, many consumers are left with condos as their primary price point but often hit a quick hurdle when they learn how difficult financing is.  At a recent continuing education class, I overhead a classmate discussing her “secret list” of condos that has passed through the ringer with lenders and obtained financing.  These condos have the right mix of reserves, renter to owner ratios, insurance requirements, etc. so they were are able to pass through lender’s rigorous requirements oftenwith less than 20% down.  Turns out she works for a Mortgage Broker and has been at this for a while.   They have been keeping detailed lists of which condos were approved for loans (and denied )as a service to their realtors.

I asked a few more questions since so many condo deals cancel during the  condominium title insurance process and I wanted to know more:

What you have learned about financing condos?  Realtors in Miami-Dade/Broward County know how hard it can be to get financing on a condominium. I’m sure the moment a buyer says they which to purchase a condo- their stress level shoots up!  Condominiums are great but trying to get them approved by the lenders condo department can be very challenging at times. Also a lot of realtors and buyers have the misconception that for all condo purchases the buyer must put down a 20% down payment. – Which is NOT true.

What kind of condo programs can you offer?

Anchor Bay Financial works with 30 different lenders.  This gives us access to work with many diverse and unique loan programs. Below we will list the two different types of condo reviews the lender will require to get your buyer’s condo approved for financing.

Full Review: Buyer is putting 5-10 % down payment the condo MUST meet the following qualifications;

1. No pending litigation
2. No single person can own more than 10% of the units
3. 15% of the homeowners are 60 days past due on HOA fees
4. 10% of budget is allocated towards reserves
5. Land Lease must be reviewed by an Attorney must advise if Lease meets Fannie and Freddie guidelines
6. Commercial space cannot exceed 25%

Limited Review: Buyer wishes to pay above 10% down. To be eligible for a Limited Review, the unit securing the mortgage must be located in one of the following project types: a) An attached unit in an established condo project, meeting the following o At least 90% of the total units have been conveyed to the unit purchasers;

2. The project is 100% complete, including all units and common elements;
3. The project is not subject to additional phasing or annexation;
4. Whether control of the HOA has been turned over to the unit owners.

As you can see there are a lot of factor’s to take in consideration but it can be done!  Fortunately, through the years we have accumulated list of projects in the Miami-Dade/Broward area that have been approved or denied in the past.

How you can help buyers locate a condo that is more likely to be eligible for financing?  

My “secret list” is a reference tool we use to better guide us to which communities have been approved in the past or has a likelihood of getting approved in the future. With every new potential buyer, it is the responsibility of the Realtor to research any community the buyer intends to buy. In addition, having a good mortgage team behind them with unique loan programs and handy tools, such as  this list.

Please contact Leticia for more information on what condos are eligible for financing before you start looking!

Leticia Nin  NMLS#1624197, MLO Assistant

Anchor Bay Financial LLC NMLS #1574368

Cell: (305)833-7240  [email protected]

For a fast title quote on your condo title insurance purchase please call 305-271-0100 or [email protected]

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