Condotel And Non-Warrantable Condo Financing

Gustan Cho Associates

What Are Non-Warrantable Condominium Mortgages?

Non-Warrantable Condominiums are condominium units that are in a condominium building or complex that does not conform to conforming mortgage lending guidelines.  Non-Warrantable condominium units do not follow FHA, Fannie Mae, Freddie Mac, VA, of USDA mortgage lending guidelines due to many factors.  One of the biggest factor whether a condominium is a warrantable or non-warrantable condominium is the owner occupancy percentage versus the investor occupancy percentage of the condominium building and/or condominium complex.  If 51% or more of the ownership of the condominium units are owner occupant condominium units, then the condominium building is classified as a warrantable condominium and conforming financing is allowed.  If 51% of the condominium units in the condominium building is owned by investors where they are rental units, it is classified as non-warrantable condominium units and the condo units are not qualified for conforming financing.  If you are a non-warrantable condominium buyer and are in need of non-warrantable condominium mortgages, you have landed on the right place.  I am a specialist in Condotel Financing and non-warrantable condominium mortgages .

Guidelines On Non-Warrantable Condominium Mortgages

There are no cap on investor concentrations on non-warrantable condominium mortgages.  On home purchase and refinance non-warrantable condominium mortgages, as long as they are second or vacation homes, minimum loan to value caps are at 80% LTV.  On cash out refinance non-warrantable condominium mortgages, the loan to value reduces to a 75% loan to value cap.  A single person or enitity on the non-warrantable condominium unit is allowed to own 10% or more of the condominium units.  Minimum credit scores for the non-warrantable condominium mortgage loan borrower cannot be lower than a 680 FICO credit score.  Foreign Nationals can qualify for Condotel and Non-Warrantable Condominium mortgages as long as they have a valid work visa and have employment in the United States through the work visa.  No credit scores are required.

Condotel And Non-Warrantable Condominium Mortgages: Portfolio Loan Program

All Condotel and Non-Warrantable Condominium Mortgages are 30 year ADJUSTABLE RATE MORTGAGES , also referred a ARM.  Index is based on the one year Cost Maturity Treasuries , also commonly known as the CMT, and the margin is fixed at 3.0%.  The adjustable rate mortgages offered is the 3/1 ARM, 5/1 ARM, and the 7/1 ARM.  Starter rates are in the 5.0% to 6.0% range and the rates when it adjusts cannot be lower than the starter rate.  The non-warrantable condominium building cannot be under serious litigation or have major structural issues or building violations, needs to have ample reserves, and cannot have more than 10% of the units in foreclosure. The individual condominium unit needs to be at least 500 square feet and needs to have a full size functional kitchen and at least one bedroom.  Minimum mortgage loan size is $100,000 and there is no maximum mortgage loan size.  Borrower needs to have at least one year reserve for the principal residence as well as the subject purchase property as well as any other properties they may have.  Reserves do not have to be in cash.  Retirement funds and other liquidable securities can be used for reserve requirements.

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

2 Comments

  1. Toby Vickers says:

    I have a unit in New York, and want to do a cash out refi on a non-warrantable investment condo.

    Can you help?