Thinking about buying a condominium in NON-Warrantable Florida? The first thing you will need to determine is whether you are buying a “warrantable” or “non– warrantable”NON-Warrantable FL Florida condo.
FLORIDA NON WARRANTABLE CONDO OVERVIEW
All non-warrantable issues considered
High investor concentration
Large, single entity ownership
High commercial percentage
Small projects with no HOAs
Condo conversions
New developments
Max 80% LTV (primary or second home)
Max 60% LTV (investment properties)
Maximum loan amounts up to $3,000,000 (LTV limits apply)
Cash-out refinancing available to $1,500,000 cash in hand
Florida Condotel Mortgage Lenders Overview:
Max 75% LTV (primary or 2nd home)
Max 60% LTV (investment properties)
Cash-out refinancing available to $1,500,000 cash in hand
Florida Mortgage Lenders CondoTel + Non Warrantable Condo Loan Program Details
Lending Area
Available in all Florida, Georgia, Texas, Alabama, California, Colorado
Second Home Provisions
Second home (typically must be in a vacation or resort area and 30 miles from primary residence or used as college housing for enrolled dependent within 5 miles of campus)
Condo LTV
80% primary or second home
60% investment property
Condotel LTV
75% primary or second home
60% investment property
Maximum Loan Size
$3 MM
ComponentRequirements
No efficiency or studio condos must be minimum 500 square feet. Exceptions made on a case-by-case basis, with a reduced LTV.
Must have a full-size kitchen and separate bedroom
DocumentRequirements
All Condos require a completed Florida Mortgage Lenders Condominium Questionnaire1 and must pass our underwriter review
Work Visa/ Expatriate/Immigrant Eligibility
Yes
See Work Visa/Expatriate/Immigrant Loan Program sheet for details.
Asset Depletion
Yes
See Asset Depletion Program for details.
Gifted down payment / Gifted Reserves / Gift of Equity
Yes
Non-Occupant Co-Borrowers
Allowed at max 70% LTV
See Guidelines for details.
Foreign National Eligibility
(Non-U.S. Residents)
Yes
See Foreign National Program sheet for details.
NON-WARRANTABLE CONDO, AND CO-OP MORTGAGE LENDERS TERMS The ARM is a 1st mortgage adjustable rate loan with principal and interest payments amortized over 30 years.
3/1 ARM: Rate is fixed for 3 years.
5/1 ARM: Rate is fixed for 5 years.
7/1 ARM: Rate is fixed for 7 years.
30 Year fixed for 30 years.
FLORIDA NON-WARRANTABLE CONDO, AND CO-OP MORTGAGE LENDERS SUMMARY
Up to 90% LTV
Credit scores as low as 600
Loans up to $3 million
Up to 100% investor concentration
New construction: minimum 25% sold & closed
Up to 43% DTI
High and low-rise condos acceptable
Owner-occupied, second homes, and investment properties
1 Project is: Condo and PUD’s are allowed. HOA certification not needed for a PUD 2 Unit is: Attached and Detached projects are allowed 3 Units are:If Leasehold, project is ineligible 4 Unit owners in control of HOA?Developers or unit owners may be in control. If Developer is still in control, condo is considered new and requires a FNMA PERS approval 5a Are all units complete? Are all common elements and amenities with the subject phase complete? All units, common areas, and recreational facilities must be 100% complete for the subject phase 6a Is the project a legally phased project? If yes, is the project subject to additional phasing / annexation / add-ons? Additional phasing and add-ons are allowed. Condo is considered new and requires PERS approval 7a Is the project a conversion of an existing building? If yes, was conversion a full gut-rehabilitation? Condo conversions that are at least 3 years old are eligible 8 Project pre-sale and owner occupancy questions are for residential units only: The date when first units were made available is used to determine if the project is selling at an acceptable rate 9a How many units are over 30 days delinquent? If units are delinquent, what is the balance owed? If more than 15% of the total units or 10% of the total budget are greater than 29 days delinquent, project is ineligible. 10a Total income budgeted this year, total reserves budgeted: At least 10% of the total budget should be allocated for reserves 11 Is project part of a “Master” or “Umbrella” Association? If yes, additional information may be required for eligibility 12 Does any one person or entity own more than one unit? No single entity may own more than 10% of the total units 13 Are there any pending or outstanding special assessments? If yes, obtain details and determine the impact on all units and marketability 14 Is the HOA involved in any litigation, mediation, arbitration, or other dispute resolution process? If yes, obtain details (attorney opinion letter) and determine risk. If litigation affects the structure or marketability , the project in ineligible 15 Are there any adverse environmental factors affecting the project as a whole or as individual units? If yes, the appraiser must address the impact on value and marketability 16 Does the homeowners’ association have a reserve fund separate from the operating account? At least 10% of the total budget should be allocated for reserves 17 Do the project legal documents include any restrictions on sale which would limit the free transferability of title? If yes, the only restrictions allowed are age restrictions Is the unit part of a legally established condominium project, in which common areas are owned jointly by unit 18 owners? If no, project is ineligible 19a Do unit owners have sole ownership & exclusive right to project facilities? If no, project is ineligible 19b Are any project facilities (parking, recreation facilities) leased to the HOA? If yes, project is ineligible 20a Does the project consist of manufactured housing units? If yes, project is ineligible 20b Are any units less than 400 square feet? If yes, project is ineligible Are any of the units used for “live-work” (e.g., the unit owner lives in a loft area and runs a business on the 20c ground floor)? If yes, project is ineligible Is the project a Continuing Care Retirement Community or Life Care Facility where residents sign long-term 20d contracts for housing, medical, assisted-living, and other services? If yes, project is ineligible
21 If a unit is taken over in foreclosure or deed-in-lieu, is the lender responsible for delinquent HOA dues?
If yes, the mortgagee may not be responsible for more than the greater of 6 months ‘ or the maximum amount permitted under applicable state law 22 Does the property operate as a resort hotel; renting units on a daily basis? If yes, only allowed on a case by case basis with prior management review and approval 23 Is any part of the project used for commercial purposes? If yes, only allowed on a case by case basis with prior management review and approval
24 Do the project legal documents or local zoning limit the amount of time the owners can live in their unit? If yes, project is ineligible 25 HOA is named insured on master insurance policy? If no, project is ineligible 26 Are common elements / limited common elements insured to 100% replacement cost? If no, project is ineligible 27 Are units or common improvements located in a flood zone? If yes, flood insurance is required 28 Is the HOA insured for general liability? If no, project is ineligible 29 Does the HOA provide hazard insurance coverage for the interior (walls-in) of the condominium unit? If no, the borrower must obtain a separate HO-6 policy 30 Is the HOA insured for Fidelity Bond? Fidelity bond coverage is required for projects over 20 units , must be $1 million per occurrence and must be at least equal to the greater of 3 months HOA dues or reserves or minimum required by state law. Minimum number of days required for written notification to be given to HOA or insurance trustee before any 31 substantial changes or cancellation of the project coverage. Minimum of 10 days required We certify that the right of first refusal does not adversely impact the rights of a mortgage or its assignee to foreclose or take title to a condo unit pursuant to the remedies in the mortgage; accept a deed or assignment in lieu of foreclosure in the event of default by a mortgagor; and sell or lease a unit acquired by the mortgagee or 32 assignee. If no, project is ineligible
Non Warrantable Florida Condo Mortgage Lenders
1 Unit Residential:
– Condo- Non Warrantable
– Non-Warrantable Condo
– Condotel (75% LTV max)
– Co-op Non Warrantable
– Unique SFR or Condo (70% LTV max, but may be reduced further case-by-case)
Non warrantable condo lenders Specifications
Maximum 80% LTV/CLTV for primary residence
DTI cannot exceed 43%,
Non warrantable Florida Condo Cash-Out Refinance
Maximum 80% LTV with 740+ credit score, otherwise 75%
Up to $3,000,000 cash-in-hand permitted less any mortgage payoffs
Paying off a non-purchase money 2nd mortgage is defined as cash-out
No ownership seasoning required but must have settlement statement from purchase
Source and seasoning required if purchased within the prior 6 months
Proceeds from cash-out can be used to meet reserve requirement
Power of Attorney not allowed for cash-out refinances
Delayed Non Warrantable Condo Financing
Florida Cash-out allowed if non warrantable condo loan funds within 6 months of cash purchase without LTV reduction or rate adjustment
Refinance Florida Non Warrantable Condo Listed on MLS
No Off-MLS seasoning requirement
1.0% discount point fee is required. Home can remain listed For Sale.
Refinance Florida Non Warrantable Condo Listed For Sale
No Off-MLS seasoning requirement for borrower-paid compensation. Non warrantable condo mortgage lenders 1.0% discount point fee is required. Home
can remain listed For Sale.
90-days off the MLS required for lender-paid compensation
Florida Warrantable Condo Mortgage Lenders (as defined by FNMA)
Maximum 80% Loan to Value for Florida Non Warrantable Condos
Non warrantable condo mortgage lenders questionnaire must be 100% complete for Approval Commitment. No blanks or questions answered “n/a” or “unknown,” and questionnaire must pass underwriter review.
Pending non warrantable litigation, when permitted by underwriting, is priced as Non-Warrantable
Must have a full kitchen and at least one separate bedroom. Minimum 500 square feet generally required. Efficiency or non warrantable studio units are not permitted.maximum 80% LTV
Leaseholds allowed if remaining term on land lease is 30 years or longer
Virtually all reasons for non warrantable Condo to be defined as Non-Warrantable are permitted
Not allowed:
– Structural deficiencies and certain pending litigation (please contact your AE if litigation is not related to a structural issue)
– Incomplete construction of the subject phase
Approved/Evaluated Case-by-Case:
– Low non warrantable Condo HOA budget reserves
– HOA non warrantable Condo delinquencies exceeding 15%
Non warrantable condo mortgage lenders questionnaire must be 100% complete for Approval Commitment. No blanks or questions answered “n/a” or “unknown,” and questionnaire must pass underwriter review.
Pending non warrantable Condo litigation not related to structural issues, when permitted by underwriting, is priced as Non-Warrantable.
Non warrantable Condo Must have a full kitchen and at least one separate bedroom. Minimum 500 square feet generally required. Efficiency or non warrantable Condo studio units are not permitted.
Coinsurance is considered case-by-case if no agreed amount endorsement is available
Non warrantable condo mortgage lenders will define a Condo unit as a Condotel when units in the complex can be reserved for daily,weekly or short-term rentals.
Number of Florida Non Warrantable Condo lenders
The number of Florida non warrantable condos financed limited to 10 with some exceptions made for very high net worth Non warrantable condo mortgage applicants. Please note reserve requirement applies to all properties owned (see Reserve Requirement & Rental Income sections).
POPULAR FLORIDANON-WARRANTABLE CONDO PAGES INCLUDE:
WARRANTABLE NON Warrantable FL ORIDA CONDO LENDERS When a NON Warrantable FL orida condo is identified as a warrantable that means it meets Fannie Mae’s and Freddie Mac’s conventional guidelines and Fannie Mae and Freddie Mac will buy the loan. Typically, a NON Warrantable FL orida condo is considered warrantable if, for instance:
No single entity owns more than 10% of the condo units in a project, including the developer
At least 51% of the condo units are owner-occupied
Fewer than 15% of the condo units are in arrears with their association dues
There is no litigation in which the condo homeowner’s association (HOA) is named
Commercial space account for 25 percent or less of the total condo building square footage
NON-WARRANTABLE FL ORIDA CONDO LENDERS
A NON-Warrantable Florida non-warrantable condo is a condo property in which the loan is not eligible to be sold to Freddie Mac or Fannie Mae, and as such, NON-Warrantable FLorida mortgage lenders for this type of property is considered by most banks to be more “risky.” Freddie Mac and Fannie Mae would consider a condo to be “non-warrantable” if, for instance, the condo:
Is in a NON Warrantable FL condo development which has yet to be completed
Is in a NON Warrantable FL condo development which allows for short-term rentals
Is in a NON Warrantable FL condo development where one person or entity owns more than 10% of all units
Is in a NON-Warrantable FL condo development where less than 50% of the occupants in a complex are the owners
Is in a NON-Warrantable FL condo development involved in litigation of any kind regardless of whether the building is suing another party, or is the party being sued.
Some of the common NON-Warrantable FL orida condo types which fall into the non-warrantable category include condo-hotels, timeshares, fractional ownership properties, and other projects which require owners to join an organization, such as a golf club. NON-Warrantable FLorida non-warrantable condo lenders is an expert in providing residential mortgage loans for non-warrantable condos and has been active in this business for over 10 years. We have excellent non-warrantable condo loan programs and rates for loans of this type. Please contact us for your current financing needs.
