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Financing Condo’s: One Lender’s Requirements.

February 24th, 2009 Categories: Residential and Commercial Mortgages

This is the requiremnt of a specific lender effective immediately for condo financing. One should expect other lenders to follow suit.

The condominium must meet the criteria for Established Projects:

At least 90% of the total units have been sold and recorded, and
Control of the HOA has been turned over to the unit owners, and
The project or conversion is complete and not subject to additional phasing or annexation.

In addition to meeting the Established Project criteria, the condominium must meet the following eligibility requirements:

The LTV/LCTV does not exceed 80% for Primary Residences and 75% for Second Homes.
The Condominium Project can not exceed 7 stories.
The project does not have common areas or recreational facilities leased to or by the HOA.
There is no litigation pending with regard to the project or HOA with respect to safety, structural soundess, or habilitiy of the property or adversely affect the financial solvency of the HOA.
HOA must waive its “right of first refusal” to the sale, lease or transfer of a unit in case of foreclosure or deed in lieu.
Commercial use within the project can not exceed 20% of the total square footage for the project and compatible with residential use.
No more than 15% of total units are delinquent on their HOA dues by more than 30 days.
The project is not an ineligible project, such as being subject to inclusionary zoning, being a condo-hotel or timeshare, having rental programs, multi-dwelling units, manufactured homes or houseboats.
The HOA maintains “master” or “blanket” type of insurance covering all general and limited common elements with:
- 100% replacement cost of project facilities, including individual units.
- Maximum deductible is 5% of face amount of policy.
- General liability coverage of $1,000,000 for bodily injury and property damage for entire project for any single occurence.
- Flood insurance, current coverage, if applicable.
- Fidelity bond is required for any project with more than 20 units (coverage equal to the total monthly assessment of HOA dues for all units times 3 months).

These requirements may appear a little dicey but they are basically the same as they were about 10 years ago.

Your comments are welcomed.

Posted by John Duffner | Currently Comments Off

Wright Mortgage Compnay

June 7th, 2008 Categories: Residential and Commercial Mortgages

John Duffner’s Mortgage Brokerage, Inc. has associated itself with The Wright Mortgage Company.

Both companies are brokerages and jointly their focus is residential and commercial loans.

Why Use A Broker?

Independent mortgage brokers have had a significant impact on the lending industry. Today, the use of a professional (licensed) mortgage broker is one of the key strategies used by sophisticated borrowers.

What Is A Mortgage Broker?

A mortgage broker is an independent real-estate financing professional who specializes in the origination or residential (or commercial) loans. Mortgage brokers normally pass the actual funding and servicing of loans on to wholesale lending sources. A mortgage broker is also an independent contractor working with (on average) as many as 40 lenders at any one time. By combining professional expertise with direct access to hundreds of loan products, a mortgage broker provides the most efficient way to obtain financing tailored to a borrowers specific financial goals.

What Do Mortgage Brokers Do?

In the volatile mortgage market, mortgage brokers can serve as safeguards, offering clients security, safety, and peace of mind. One of the broker’s most important functions is escorting a borrowers loan application through the entire process, constantly patrolling the component transactions for possible breakdowns. A professional mortgage broker can wade through the mountains of rate data and program options, researching current market conditions to find the most accurate and up-to-date information about cost-effective loan options.

Brokers Handle the Details!

There are literally thousands of variables that can affect the outcome of a mortgage transaction. That’s why you need a mortgage broker to act as a liaison between the title and escrow company, real estate agent, lender, appraiser, credit agency, the underwriting, the processors, attorneys (when utilized), and any other services which may affect the transaction.

Other Items A Mortgage Broker Does: