Condominiums have recently taken quite a hit with the housing decline. As a result it has been harder and harder to secure a loan on a condominium through a lender. In response to the increased number of condominiums going to short-sale or foreclosure, investors who purchase the loans from lenders are again responding with MORE RULES. These rules go into effect October 1, 2009 and may affect your ability to obtain a loan depending on the complex you plan to purchase your condo from. These new rules include:
- If 15% of the Condominium's Association's dues are in areers - there will be no loan.
- If there is pending litigation in the complex - no loan
- If the lender is unable to purchase Mortgage Insurance - No loan
- 50% of the complex must be occupied with owners not rentals
- Conventional loan requirements will be 10% downpayment up 5%.
- FHA is no longer requiring the condominimum to be approved, however, individual investors will be permitted to make up their own guidelines.
- Resale certificates and Condominium Questionnaires will be required
If you are contemplating the purchase of a condominium you will want to be sure your realtor and your mortgage person are in tune with these new requirements and understand the impact on your purchase. For more information give us a call at 314-749-0921 or contact our Team partner Chris Simms, Certified Mortgage Planner at Pulaski Bank, 314-229-4242 or csimms@pulaskibankstl.com.
The Simms Team