RURAL CONDOS? It recently dawned on me that the very folks seeking affordable housing in our tri county area would be best served by our USRDA Rural program. This 102% (yes 102%) government subsidized loan program is designed for buyers who have not owned in the last 3 years, who can document sufficient income (41% DTI) and fall under a median average income cap (1-4 persons up to $70,750 annual income in non high cost counties). Credit standards somewhat flexible.
The great boon of this program is that the seller can contribute to the buyer's needs as long as the transaction makes sense and the appraisal supports the sales price. And that 102% is for the appraised value, not just the sale price...which really comes in handy to find costs to close. A 2% RD fee is financed and there is no monthly mortgage insurance. Too good to be true? We have several lenders who specialize in this program. Some banks have a limited access to USDRA funds and others are not limited...so it helps to work with a broker who has all these resources.
WHERE? I have funded several county condos and am aware of other projects in our rural towns including Ferndale, Blaine, Everson, and Lynden that would qualify...basically anything outside Bellingham to Mt Vernon city limits.
Search the USDA Rural Housing site: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do Select single family on the left side menu (or multi family if you are looking for duplex-fourplexes) and you can plug in your property zip code. Print out a map of your area for future reference.
THE CATCH: The project must be warrantable and HUD approved. So at least 51% must be sold and the developer cannot be in control of the HOA or own more than 10%. A savvy developer will team up with a couple of local banks or private investors to fund the filrst 51% and we can step in on the last 49%.
OTHER OPTIONS: If the project does not have HUD or FNMA we do have private or hard money loans. In some cases, closing via private money and sitting tight for a couple of years while the project is completed and becomes warrantable will work. Condos that fall within the city limits of Bellingham do not qualify for USRDA. For city or kiddie condos (student/parent owned), FHA works well @96.5% financing.
OUTSIDE THE BOX: Rural condos and cluster homes that may be PUD or Leasehold properties are very valid options in our region to meet the needs of today's buyers. You just need a lender worth their salt who can find your funds. Not all lenders are FHA/HUD/USDA approved so needless to say call Loannetter first!
Washington Licenses: 510-LO-31434 510-MB-24707-50145