Prefer to talk in person? Find a mortgage specialist on Zillow
Profile picture for mommaroo

Wanting To Buy a Condo.

We've found a condo in our town which we can buy at a bargain price. When the RE market begins its recovery, I have no doubt that the unit will appreciate in value.
We intend to sell our home, but doubt very much that we'll find a buyer before we purchase this one,( provided that we get the financing).
The mortgage lender says the condo would be considered investment property, and not eligible for FHA financing. The final glitch in our mortgage approval has to do with Fannie Mae guidelines. Although the complex is 7 years old and meets every other requirement, the question of 6 lots has put the loan on hold. The builder, financially unable to build on these lots since the downturn, has recently sold them to another builder. The bank is now saying that these lots represent phase 2 in the project, making it fall under the new guidelines, and the condo documents don't adhere to the new guidelines. These lots are all part of the original complex but now have a new builder. It seems awfully anal to find this as a problem. We are putting 25% down, and as I said, all other requirements have been met. ( BTW, the 6 lots represent a total of 36 residences.) Any suggestions on how we can get around this? I would have no problem going through another lender.
  • October 30 2011 - Brunswick
  • 0
    0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

Answers (2)

Profile picture for shapiroamg
There is a question on the condo questionnaire that any lender or broker must get answered to make sure the association fits fannie or freddie guidelines. It has to do with additional phasing and that also answers no to questions about the common areas being finished and if any one unit owner owns more than 10% of the units.
No matter how much you think this is a good deal, it could become a real nightmare in the future if the new developer goes bust. He/she could finish those units and then not sell them and withhold condo fees. Would that make any condo there more marketable?  I would advise to stay clear as these unresolved questions will hamper any future appreciation you think you may have.
  • October 30 2011
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

If you are already having this many stumbling blocks up front regarding getting the financing to buy one, just think about what will happen when you go to sell it. When getting the financing for a condo, you shouldn't have this many upfront issues. When they come up like this, it should be a red flag. I've had sellers who have purchased in a condo complex and have not been able to seel them because of financing guidelines. You would be better off to let this "good deal" just do by. Your lender will be able to explain the issues with trying to sell a condo with issues like these. Thank you for your question.
  • October 30 2011
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.