Ch, Ch, Ch, Changes to C, C, C, Condos

Mortgage and Lending with Guaranteed Rate, Marin County, CA NMLS: 22343

Ch, Ch, Ch, Changes to C, C, C, Condos


At various times over the last 10 years, getting a mortgage on a condominium in California could have been quite the challenge for a homebuyer.  However, some changes that will go into effect at the end of June, 2018, will reflect Fannie Mae's (FNMA) increased flexibility and sensibility with lending on condo, co-op and planned unit development (PUD) projects.  We're going to focus here just on the condo part and explain the key elements that should make it a bit easier for some buyers in the months ahead.


Single-Entity Ownership

Single-entity ownership poses a risk for a condominium lender because should that single owner who owns a high percentage of the units in the complex run into financial difficulty or do something financially irresponsible, it could materially impact the financial health of the entire complex.  The changes in our update here allow the following:

  1. Waiver of the single-entity ownership requirement when the purchase transaction will result in the reduction of of single-entity concentration.  
  2. Units held by non-profits, affordable housing programs or institutions of higher education are exempt from the calculation.
  3. Single-entity ownership in projects with 21 or more units is increased to 20% (from 10%).


Commercial Space

Projects can now exempt commercially owned or operated parking spaces from the project's commercial space calculations.  This item, for example, can be a big factor in the city of San Francisco.  Another significant change is the allowance of commercial space in the project to increase from 25% to 35%.


Limited Reviews

Primary home purchases of condo properties have long benefited from the "limited review" which is an automated and streamlined process that determines the eligibility of the condo project very early in the loan process.  Up until now, a limited review was never an option on an investment property so as a lender, we knew that when an investor went into contract on a condo, we'd have to obtain all of the condominium documents (CC&R's, budget, condo questionnaire, etc.) to approve the project itself.  Now, with a limited review a possibility up to a loan-to-value of 75%, many condo buyers will avoid the high bar that had been previously set.


Two- to Four-Unit Condo Projects

Waive project review requirements aside from some basic requirements (insurance, for example).


These are some far out changes to condos and I can certainly see them immediately helping future generations of buyers and investors.  And they're exactly the sorts of common sense adjustments the government-sponsored entities should be implementing.  If you're looking to purchase or refinance a condominium in California, or if you've tried and failed to finance a condo in the recent past, let me know if I can help at any time. 


Ground control to Major Tom,



Robert J. Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 Fax: 415-366-1590

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate's Human Resources Department.


Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood ChicagoIL 60613 - (866) 934-7283


Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Marney Kirk 06/12/2018 05:36 PM
  2. Gabe Sanders 07/01/2018 11:00 PM
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Marney Kirk
Cummings & Co. Realtors - Towson, MD
Towson, Maryland Real Estate

This is GREAT information - I reblogged it! Thank you, Rob Spinosa !

Jun 12, 2018 05:40 PM #2
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

As someone who is buying more Florda condos I welcome the information. I also own Hunky Dory.

Jun 12, 2018 05:43 PM #3
Matthew Klinowski, PA
Downing-Frye - Naples, FL
Golf Community Real Estate Specialist

Rob, thanks for sharing this information.  Buying condos can be challenging with the restrictions on specialty loans. 

Jun 12, 2018 07:13 PM #4
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I enjoy the use of David Bowie that you did here! It adds a certain flavor that I really like!

Jun 12, 2018 10:54 PM #5
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I guess we have to roll with the punches or move the trans and just be adaptable and moldable like clay with certain aspects of the business.

Matthew Klinowski, PA

Jun 12, 2018 10:55 PM #6
Dorie Dillard CRS GRI ABR
Coldwell Banker Realty ~ 512.750.6899 - Austin, TX
Serving Buyers & Sellers in NW Austin Real Estate

Good morning Rob Spinosa,

Thank you for an informative post about condos..I've been hearing rumblings they are going to relaxing the Condo guidelines so glad to hear its sooner than later.

Jun 13, 2018 04:45 AM #7
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Rob shines a good light on this subject....

Jun 13, 2018 05:34 AM #8
Sharon Kowitz
CRS-SRES-ABR-GRI-E-Pro-CREN Fonville Morisey Cary, NC - Cary, NC
Cary, NC Relocation Specialist ~ Buying or Selling

Great news! In our area, we have lots of condo's downtown Raliegh NC and condos near NC State University as well as Duke and Chapel Hill Universities. 

Parents buy for children while in school then resale so it looks like absentee owners on our tax records since the owners live at other address. 

Jun 13, 2018 06:15 AM #9
L. Scott Ferguson
Ask4Ferguson - Your House-SOLD Name in Real Estate - West Palm Beach, FL
Sunny Florida Real Estate Professional



What a great post and awesome info!  Very informative!





Jun 13, 2018 08:53 AM #10
Mott Marvin Kornicki
Waterway Realtors® • South East Florida • Real Estate Brokers - Miami Beach, FL
Waterway Realtors, Miami Notary 786-229-7999

Very good information as the condo type of ownership is very popular. I don't recall reading about the number of units lease as opposed to owner-occupied. That is a huge dilemma here in South Florida.


Jun 13, 2018 02:12 PM #11
Jana Holmstrup
Jana Holmstrup - CCO - Kings Mortgage Services, Inc. - Visalia, CA

Thanks Rob! I was confused when the announcement came out and haven't taken the time to go back to it yet...

My confusion was on Item #1. So what you're saying is as long as the Seller is a multi owner then we can ignore % ? Because in theory their ownership % would be reduced? I think my light bulb may be flickering!!

Jun 13, 2018 06:24 PM #12
Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

This is great to know, Rob, especially here in San Francisco.

Jun 13, 2018 07:56 PM #13
Wayne L. Brown
Franklin Advantage Inc. - Alpine, CA


As always, thank you for this timely information.

Jun 14, 2018 09:19 AM #14
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Love these changes.  Helping a buyer now and we're running up against too many investors, so maybe the 20% rule will help us?!

Jun 14, 2018 08:36 PM #15
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Hi Rob

This is great information! Thansk for the education about the changes that can help condo buyers...and there are a lot of them in Southern California.


Jun 15, 2018 07:37 AM #16
Hannah Williams
Re/Max Eastern inc. - Philadelphia, PA
Expertise NE Philadelphia & Bucks 215-953-8818

I agree wit George Souto  would be nice to see more FHA and goverment loans in condo communties once more .

Jun 15, 2018 10:11 AM #17
John Wiley
Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

I recently listed a condo. During the listing period an investor bought the undeveloped part of the project and this made the whole property fall out of the FHA guidelines. It finally sold to a cash buyer.

Glad to see some changes are being made in the policy.

Thanks for the information.

Jun 16, 2018 04:52 AM #18
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Hi Rob.  Thanks for the excellent information.  This has big implications here in my area.

Jun 24, 2018 05:12 AM #19
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Real Estate Agents - Luxury - Divorce

Oh gotta love Fannie and flexible in the same sentence !

Jul 02, 2018 03:27 AM #21
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hello Rob - thanks to Gabe Sanders' reblog, I read this post. Good information. Bookmarked. 

Jul 02, 2018 07:58 AM #22
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Rob Spinosa

SVP of Mortgage Lending, Marin County
Can I Get a Jumbo Loan with 10% Down?

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