What are Condotel Loan Requirements?
With the new year comes new Condotel Loan Requirements. Condo Hotel units are becoming more popular than ever and Condotel mortgage loan requests are at an all time high since the real estate and credit collapse of 2008. Condotel Loan Requirements are different than traditional condo or single family home loan requirements.
Condotel Loan are Portfolio Loans
Condotel mortgage loans are portfolio loans. By portfolio loans, the lender will not be selling a condotel mortgage loan to the secondary market. They will be holding the loan in their own portfolio.
Condotel Loan Guidelines
A few of our Condotel Loan Requirements include that the Condotel need to be at least 500 square feet, have a separate kitchen area, and at least one bedroom. Efficiency or studio Condotel units do not qualify. There cannot be any major litigation pending and the Condo Hotel cannot be in financial distress such as a pending bankruptcy. The Condo Hotel cannot have any major structural issues or pending major building violations as well.
Condotel Loan Questionnaire
There is a one page Conotel Questionnaire form that needs to be completed by the Condo Hotel Homeowners Association representative that will ask these specific questions.
Minimum Credit Scores for Condotel Loan
Another Condotel Loan Requirement is that the Condotel unit mortgage loan borrower needs a minimum credit score of 680 FICO. If your credit scores fall below the required 680 FICO, please contact me at 262-716-8151 or visit me at www.gustancho.com and I will help you in boosting your credit score prior to submitting a formal Condotel mortgage application.
One year reserves are required for Condotel Loan Programs
Reserves is another Condotel Loan Requirement. We require that you have at least a one year reserve of principal, interest, taxes, and insurance for the subject Condotel unit as well as your principal residence. The Condotel Loan Requirement is that you have at least three months of reserves in cash or stocks and the remaining nine months can be in retirement funds, annuities, or other assets.
25% down payment for Condotel Loan Purchase
Other Condotel Loan Requirement include a minimum down payment of 25% for second homes. If you own more than one Condotel unit already, your Condotel purchase will be considered an investment Condotel.
40% down payment required for investment Condotel Loan Programs
Condotel Loan Requirement with investment condotel units are the same as second home Condotel units except that we require a 60% loan to value. Reserve requirements are the same.
Minimum Loan Size
Minimum loan size on Condotel loans are set at $100,000. It can be a lower loan amount on a case by case basis. There is no maximum loan amount. The reason there is a minimum loan amount Condotel Loan Requirement is because it takes the same amount of time, same amount of paperwork, and the process is the same to underwrite a $100,000 Condotel mortgage loan as it is a $1 million dollar Condotel mortgage loan.
If you need more information or questions on our Condotel Loan Requirement, contact me at 262-716-8151 or visit me at www.gustancho.com .