Some condo financing questions
Here in the High Country, we have lots of condos. Some are primary homes, many are purely second homes, but most are rental properties. We are a location where people from all over the world want to live or at least rent a condo for a long weekend, week or month. Financing condos is a major part of my business, as I am confident it is with most all mortgage lenders.
So it is very important that condos have financing available, and that requires a lot of jumping through hoops for the mortgage investor. The underwriters want to know a lot of facts on the condo project, such as the number of units in the complex, what percentage is residential and what percentage is commercial space. The underwriters want to see the annual budget for that condo complex, and they are now looking very closely at the condo declarations and the insurance coverage of the complex.
In addition, the underwriter wants the property management company to supply details on the number of owners that may be delinquent in their dues and if the home owners association is either a plaintiff or defendant in a lawsuit.
All these facts are reviewed and re-reviewed by the underwriters to determine if the condo complex meets the minimum requirements of their lending institution. If one of the requirements has not been met, the condo complex may be one that cannot be funded by standard conventional lending.
Now, to you the consumer all this may sound like a nightmare, but I can honestly say it is not that bad. One investor may decline to lend on a condo complex, but there are other investors who would have little to no problem financing such a condo.
The bottom line for you the consumer is to understand that if you are looking to invest in a condo, take time to meet with your mortgage lender so all the numerous documents may be gathered and reviewed by their underwriter. Adequate time must be given so if the first investor declines financing, your file can be moved to another investor. By planning in advance, you can reduce or eliminate some headaches that seem to arise when little time is available.
For answers to your mortgage related questions call Bob Kieber at (970) 262-1199 or e-mail him at firstname.lastname@example.org. Bob is a local mortgage lender and principal of Resort Lending.
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