So You Want to Buy or List a Condo...Will Financing Be Available?

By
Mortgage and Lending with SWBC Mortgage 410-960-2061 NMLS 196068

I got a call yesterday from a realtor (referred to me by Margaret Rome, THANKS MARGARET) who has a client interested in condo living.  There are some fabulous condos on the market, the prices are right, the amenities are fabulous.  For cash buyers, condo living may be a no brainer, but for many the question will be "Will financing be available?"

To determine if the condo is currently approved for FHA financing, click here.

To determine if the condo is currently approved for VA financing, click here.   It can take 8-12 weeks for the VA legal department to approve a condo.  Documents including budget and condo docs will be required for review.

The condo association may already be approved for conventional financing by specific investors, your loan officer should be able to determine.  If not, the investor will need at least the following information from any condo association you are considering (if they are not already approved):

  1. 2011 budget
  2. Condo Master Insurance Policy
  3. Signed and Dated Condo Questionnaire

There may or may not be a fee required by the condo associated for gathering the documentation.

Most lenders will  probably not approve financing if:

  • it is less than 51% owner occupied
  • the association is involved in any litigation
  • there is over a 15% delinquency rate on dues
  • the condo is over 20% commercial
  • one entity owns 10% of the condos

Don't be discouraged if a condo listed for sale is not yet approved for available financing, with some skill, diligence and proper documentation, we can help you to navigate the approval process for condos in Maryland so when someone asks "Will financing be available?"  You can answer "YES" with confidence!

UPDATE:  Local lenders may have portfolio (in house) financing programs that National lenders do not.  The guidelines are determined by their management team, and not subject to Fannie Mae, Freddie Mac or governmental rules. I have spoken to a local lender who has an Adjustable Rate Mortgage (ARM) program that may be a good option for some condominium buyers.  We will continue to research financing options to ensure the best fit for the client.   If we don't offer a program that works for a buyer or their home of choice, someone else does (as long as we are aware of the option) we will happily refer the buyer to that lender.

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Warm Regards,

Bridget McGee  Maryland Mortgage Mama  NMLS# 196068  Corridor Mortgage Group.   410-960-2061 EHO   bmcgee@corridormtg.com or marylandmortgagemama@gmail.com

 

If you are considering purchasing a home in Maryland and want to be sure you are mortgage ready, my brother Tony and I will be happy to help! We help to make the mortgage process a pleasure! 

If you already own your home, we are happy to provide a no-cost mortgage review to help you to determine if refinancing may be in your best interest.  Please contact me at 410-960-2061.

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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. John MacArthur 01/28/2011 04:22 AM
  2. Dr. Stacey-Ann Baugh 01/28/2011 04:51 AM
  3. Margaret Rome, Baltimore Maryland 01/30/2011 02:06 PM
Topic:
ActiveRain Community
Groups:
Mortgages
PG County Real Estate Pros
Maryland Real Estate and Mortgage Group
Tags:
md real estate
financing
condo financing
condos for sale
maryland mortgage
condo mortgage

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Rainer
255,399
Mary Stewart
HomeTrust Real Estate, LLC, Homes for Everyone - Wilsonville, OR
Wilsonville and Surrounding Portland Metro Areas

What a great and informative post.  Perhaps most Realtors have sold condos during their career, but I have not.  I, for some reason, have only sold and listed single family dwellings that are stand alone.  This information comes at a very appropriate time for me.  I have a client that has found a condo she likes a lot so this information is invaluable.  The good news for her is that she is paying cash so does not have to worry about financing only about the due diligence on all else that we are doing. Thank you for the post and links.

Jan 28, 2011 04:14 AM #1
Rainmaker
362,867
Bridget "Mortgage Mama" McGee
SWBC Mortgage 410-960-2061 - Baltimore, MD
Maryland Mortgage Mama NMLS#196068

Mary, so glad you found it helpful!  All the best to you and your client on the condo purchase.

Jan 28, 2011 04:19 AM #2
Rainmaker
223,010
John MacArthur
Century 21 Redwood - Washington, DC
Licensed Maryland/DC Realtor, Metro DC Homes

Damn girl..two in a row that I repost...maybe I should send along my sign in and you can just take over writing my blog.

Great information.

My concern is that banks that have foreclosed will fail to factor in the saleability of the units when pricing them as REO property. And there is no doubt that those short sale negotiators will need to understand a conventional loan offer is much stronger than waiting for more money from a FHA financed buyer..The FHA folks won't be showing up. Any agent with a brain will eliminate condo's from potential properties when dealing with FHA borrowers.

Jan 28, 2011 04:26 AM #3
Rainmaker
526,628
Dr. Stacey-Ann Baugh
Century 21 New Millennium - Upper Marlboro, MD
A doctor who makes house calls.

WOW!  You are on blogging fire.  I am reblogging this one too.

Jan 28, 2011 04:49 AM #4
Rainmaker
362,867
Bridget "Mortgage Mama" McGee
SWBC Mortgage 410-960-2061 - Baltimore, MD
Maryland Mortgage Mama NMLS#196068

John,  Thanks for the re-blog.  I don't think my writing can hold a candle to your insight on the market or into your personal life, but I am certainly blushing...

As long as the borrower is aware of the challenges and the seller is willing to provide the info needed for approval of the condo (if not already approved) condos are definitely a viable option for the right buyer.

Stacey, That is quite a compliment coming from you!  I am finally just trying to write about what I know and what folks will find most helpful!

Jan 30, 2011 12:44 AM #5
Ambassador
2,932,197
Margaret Rome, Baltimore Maryland
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

Thanks for the mention and the intelligent answer. I have listed and sold numerous condos and the financing can be challenging to say the least. There are some amazing buys right now for cash buyers. I am also suggesting that sellers consider owner financing.

Like, Dr. Stacey and John, I am doing  reblog!

Do you realize that commenter 3,4,5 and 6 will be getting together for lunch on Saturday?

Jan 30, 2011 01:55 PM #6
Rainer
128,727
Dan Quinn
The Eric Steart Group of Long & Foster Real Estate - Silver Spring, MD
Dan Quinn

Good post Bridget.  This is a poignant issue in today's condo markets which makes this post both timely and extremely relevant.  Thanks!

Jan 31, 2011 04:42 AM #7
Rainmaker
362,867
Bridget "Mortgage Mama" McGee
SWBC Mortgage 410-960-2061 - Baltimore, MD
Maryland Mortgage Mama NMLS#196068

Margaret, Cash buyers will get some great deals as long as the sellers can afford it!  Buyers will have to do their due diligence with the Homeowner's Associations to ensure they are willing to take the risk on that end.   Owner financing may be a great option for both buyers and sellers!

Hopefully commenter #7 will join us too!

Dan, Thanks for stopping by!  Will you be able to join us on the 5th at the Suburban House?  I am hoping for a sweep of the commenters on this blog!!  Hope to meet you soon!

Jan 31, 2011 04:58 AM #8
Rainer
128,727
Dan Quinn
The Eric Steart Group of Long & Foster Real Estate - Silver Spring, MD
Dan Quinn

I will there Bridget.  I look forward to meeting you.

Feb 01, 2011 01:31 PM #9
Rainmaker
362,867
Bridget "Mortgage Mama" McGee
SWBC Mortgage 410-960-2061 - Baltimore, MD
Maryland Mortgage Mama NMLS#196068

Looking forward to it Dan!!

Feb 02, 2011 03:06 PM #10
Rainmaker
1,471,105
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

Navigating through the mortgage process can be difficult and confusing because there are many factors to consider when obtaining financing for your home. The first thing you’ll need to determine is how much you can spend on your new home, which generally depends on four main factors – the size of your down payment, your credit score, your debt-to-income ratio, and your monthly maintenance expenses. Other factors to consider include the deduction of mortgage interest on your federal income taxes, and what type of mortgage product you should obtain. 

Sep 08, 2016 05:49 PM #11
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Rainmaker
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Bridget "Mortgage Mama" McGee

Maryland Mortgage Mama NMLS#196068
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