A warrantable condo is one that a homebuyer can finance using a conventional mortgage, after having been approved under a set of guidelines set by government-sponsored enterprises Fannie Mae and Freddie Mac.
Besides, Does Fannie Mae allow non warrantable condo? Non-warrantable condo financing is unavailable via Fannie Mae and Freddie Mac, the FHA or the VA. To get a non-warrantable condo mortgage, you’ll need to talk with a specialty lender.
Why is a non warrantable condo risky?
When a condo is labeled as non-warrantable, it means that it does not meet conventional guidelines and will not be bought by government-backed entities like Fannie Mae and Freddie Mac. Many lenders consider financing a mortgage for this type of property to be too risky which can make it harder to finance.
What properties are ineligible according to Fannie Mae guidelines? Ineligible Properties
- vacant land or land development properties;
- properties that are not readily accessible by roads that meet local standards;
- agricultural properties, such as farms or ranches;
- units in condo or co-op hotels (see B4-2.1-03, Ineligible Projects, for additional information;
Hence, What makes a condominium Warrantable? Typically, a condo is considered warrantable if: No single entity owns more than 10% of the units in a project, including the developer. At least 51% of the units are owner-occupied. Fewer than 15% of the units are in arrears with their association dues.
Does Bank of America do non warrantable condo?
Unfortunately, national lenders won’t be interested in providing a loan for a non-warrantable condo. This includes lenders like Wells Fargo, Quicken Loans, and Bank of America. These larger lenders take on so many loans that they’re only interested in loans that can be repackaged and sold on the secondary market.
What is the definition of warrantable?
Definition of warrantable : capable of being warranted : justifiable take warrantable action.
What is a limited review condo?
A Limited Condo Review is a streamlined program offered by Fannie Mae & Freddie Mac for loans categorized as lower risk. Condominiums underwritten under the Limited Review program are several times MORE LIKELY TO BE APPROVED than those submitted under the Full Review program.
What is the difference between a full and limited condo review?
A Limited Condo Review is a streamlined program offered by Fannie Mae & Freddie Mac for loans categorized as lower risk. Condominiums underwritten under the Limited Review program are several times MORE LIKELY TO BE APPROVED than those submitted under the Full Review program.
How do you get Fannie Mae approved?
How to Apply for a Fannie Mae-Backed Mortgage. Homebuyers must also meet minimum credit requirements to be eligible for Fannie Mae-backed mortgages. For a single-family home that is a primary residence, a FICO score of at least 620 for fixed rate loans and 640 for adjustable rate mortgages (ARMs) is required.
What is a Fannie Mae condo limited review?
Fannie Mae and Freddie Mac can allow a limited review on a conventional loan for a condominium. A limited review will mean that we are not required to verify as many financial condominium details as a full review.
Does Freddie Mac have a condo questionnaire?
In January 2022, Freddie Mac & Fannie Mae came out with a new condominium questionnaire (or the “Condominium Supplement”) that is filled out for loans obtained to purchase condos. Why a new questionnaire? Some of the reasoning can be traced to the Champlain Tower collapse, which occurred in Surfside, Florida, in 2021.
What is the owner occupancy requirement for condos Freddie Mac?
Owner-occupancy requirements for New Condominium Projects At least 50% of the total units in the project (or at least 50% of the sum of the subject legal phase and prior legal phases) must have been conveyed or must be under contract to purchasers who will occupy the units as their Primary Residences or second homes.
Is it hard to get approved for Fannie Mae?
Typically Fannie Mae will only qualify loans to borrowers with a credit score of at least 620 according to all 3 major credit bureaus. If you find that your credit score is lower than this threshold, work on paying down your debt and making on-time payments to improve your credit score.
How long does Fannie Mae approval take?
Approved Seller/Servicer Status Our Customer Relationship Managers will work with you to identify how Fannie Mae can help achieve your business goals. This part of the process takes approximately 9 weeks to complete.
What are the disadvantages of a Fannie Mae loan?
Although Fannie Mae loans offer a low down payment option of 3%, if your down payment is not equal to a certain amount, you’ll need to purchase mortgage insurance. This extra monthly cost is added to your mortgage.
What is a full condo questionnaire?
A condo questionnaire is a document lenders require to fund a property designated as a townhouse or condominium that’s part of a homeowner’s association. The document offers evidence that condominium projects such as Eighty Seven Park Miami comply with the lender’s underwriting prerequisites.
What percentage of condos can be rented Fannie Mae?
Owner-Occupied Units Fannie Mae requires that 50 percent of the units be occupied by owners, not investors. This gives stability to the community and assures other owners that their community won’t be renter-dominated.
How long is a condo questionnaire good for Fannie Mae?
The streamlined PERS submission process for established projects requires the Condominium Project Questionnaire (Form 1076), or a substantially similar form, to be completed within the past 180 days.
