Condotel Mortgage Loans And Condotel Loan Guidelines

Condotel Mortgage Rates | Rates on Non-Warrantable Condos

Gustan Cho Associates are mortgage brokers licensed in 48 states

This Article Is About Condotel Mortgage Loans And Condotel Loan Guidelines

A Condotel also referred to as a condo-hotel, is a condominium unit in a hotel or hotel like condominium project.

  • Many name brand hotels like the Marriot Hotels, Hyatt Hotels, and Trump Hotels have condotels as part of their hotel complex
  • A condotel is owned by an individual, investors, or other private entity but the owners need to abide by the rules and regulations of the condo hotel homeowners association
  • Advantages of owning a condotel are that the owners can rent out their units for income when they are not occupying it
  • The management of the condo hotel does everything from renting it to maintenance
  • The owners do not have to do a thing but just collect the rental income
  • The management company takes a percentage of the gross rentals
  • Most condotel management companies charge a 30% to 50% commission from the gross rental amount

Condotel Mortgage Loans And Condotel Loan Guidelines And Requirements

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Condotel mortgage loans have been almost non-existent since the 2008 financial meltdown and all major banks such as J.P. Morgan Chase, Wells Fargo, Bank of America, and Citibank have stopped lending on Condotels altogether.

  • Even premier clients of these banks cannot get condotel mortgage loans
  • The great news is that Gustan Cho Associates will be able to offer Condotel loans
  • We can assist borrowers who are looking for owner-occupied Condotel loans
  • Second home Vacation home loans, and Investment home Condotel financing
  • Cash-out refinance mortgage loans are extremely popular

Gustan Cho Associates can get up to a 75% cash-out refinance loans for those Condotel unit owners who are looking to do a cash-out refinance on their second or vacation home Condotel unit.

Condotel And Non-Warrantable Condominium Mortgage Underwriting Process

Condotel And Non-Warrantable Condominium Mortgage Underwriting Process

Condo-Tel financing is available.

For Qualification, please review the following parameters:

  • The Condo-Tel Unit must have a separate Bed Room and a Full-Size Kitchen (cannot be an efficiency or Loft Style Condo Unit)
  • Minimum of 500 square feet
  • Condo Questionnaire:
  • We must have our Condo Questionnaire Completed (attached) prior to Approval
  • Reason being, the Complex has to be reviewed for adequate reserves for maintenance cost and reviewed for any ongoing Litigation
  • If there’s Litigation taken place, it wouldn’t necessarily prevent you from qualifying but would have to be reviewed by the Underwriter for Approval on a case by case basis
  • The main Litigation issue would be if the Litigation is pertaining to any Structural Deficiencies of the Complex
  • Assets requirements: must have at least 12 months of Full Mortgage Payment (i.e. Principle/Interest/Property Taxes/Insurance/HOA dues) in reserves if the financing is less than 1.0 Million
  • However, if the financing is greater than 1.0 Million, we must have 24 months of reserves
  • This would be for the Subject Property and for any other Real Estate Owned Properties you may have

For further clarification, please find our Condo-Tel Definition below:

A Condominium Complex which offers Daily Rentals to the Individual Condo Units. For Example, if the Complex has a Rental Desk and or requires the Individual Unit Owner to participate in a Rental Pool.  However, if an Individual Unit Owner has complete control on whether or not they would like to rent out their Unit, it may be classified as Warrantable or Non-Warrantable Condo. If so, the loan parameters could become more lenient.

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  1. Hello, it will be 4 years (February 28, 2021) since my bankruptcy due to a divorce and simultaneously retiring (27yrs retirement,plus disability 90% in addition currently working for the DOD) from the Armed Forces(honorably). with a credit score currently at about 698, how difficult would it be to purchase one (condo-tel) as an investment and staying when not being rented out in the Myrtle Beach SC. location with a purchase price of $125-&145k

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