By Ron Blessey, Broker/Owner, Home Buyers Mortgage Co.
A warrantable condominium project is one with features that lenders view as favorable in terms of their risk exposure on loans secured by individual condo units. The warrantable terms are prescribed by Fannie Mae.
The requirements of warrantability include such features as the following:
1.?? ?The project (including all common areas) is fully completed and the common areas are insured.
2.?? ?If a unit is located in a Phased project, that Phase must be complete and not subject to future development rights.
3.?? ?The management of Homeowner Association has been turned over by the developer to the unit owners.
4.?? ?50 percent or more of the units are owner-occupied. This would include second homes in that 50 percent calculation.
5.?? ?No one person owns more than 10 percent of the units.
6.?? ?No more than 15 percent of the Homeowners can be one month or more delinquent in their dues.
7.?? ?Fidelity Bond Coverage must be in place to cover any losses due to employee fraud or embezzlement.
8.?? ?Hazard Insurance must be in place for the project and if that policy does not cover interior replacement, or HOA coverage, the buyer must put in place their own interior policy.
9.?? ?An HOA Budget must be available at all times and must reflect an amount of current funds in the HOA account of a minimum of 10 percent of the total yearly dues in reserves.
10.?? ?The CC & Rs must be up to date and available should an UW have questions about something represented on the condo questionnaire.
11.?? ?There should be one contact person who will provide information upon request to the lender and the appraiser to ensure a continuity of information.
12.?? ?Seller?s agents should familiarize themselves with every aspect of a listing they are representing and speak with me about any issues that may be of concern.
There are a number of issues that would classify a project as non-warrantable: commercial usage of a portion of the property, more than 50% of the project being investment properties, and concierge service for short term rentals, to name a few.
Source: http://santafesir.com/news/warrantable-and-non-warrantable-condominiums
troy davis execution date troy davis execution date skylar grey building 7 parenthood dadt dadt
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.