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high rate / fee for condo vs single family detached condominium

Hi,
I am  about to close on a single family detached condominium in which I would own the structure as well as land. The community is classified under condominium with regular HOA dues but within the community , the units are detached single family homes.
The appraisal also came in as a single family residence.
Now, the broker that I am going through, at the last minute , comes tells me that there would be a mortgage rate adjustment needed because the underwriters still consider it as Condos. 
The broker had given me a GFE considering it was a single family residence. This was shocking and surprising that he comes and tells me that my rate / fee might go up.

what would constitute this property as SFR vs Condo? none of the homes share roofs or walls!
Is the broker trying to play some games here because it is too late in the process (only few days left for closing) and as a borrower, I don't have much options. I had already had to push the closing date twice because of incorrect appraisals.
  • July 30 2012 - US
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Answers (9)

Profile picture for movetobeach
I am having same problem with my loan.  I just go last minute call 3 days before closing date.  The issue did come up before we got the loan approval.  We went back and forth with it and she told me its detached condo same as single family.  Now the lender is changing the pricing on us.
I don't think people are confident enough in this business and give wroing
information and guess who has to pay???  I think their commission should be reduced to compensate for lack of knowledge.  This is poor business practice!!
  • December 17 2012
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The broker had given me a GFE considering it was a single family residence
=========================
BTW: If the purchase agreement or title work or public record your lender received (or was able to look up) when you applied already said condominium, changing pricing at this juncture due to it being a condominium is not a valid changed circumstance.

and again, it's not relevant, the pricing wouldn't change for a detached condo in relation to a single family home.



  • July 30 2012
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Use the link to the site below.  You can put in your zip code in the
  • July 30 2012
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@Chris: is there a way to find out the county classification? Are there any public records that can be accessed?
  • July 30 2012
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It all comes down to how the property is classified by the county (Attached or Detached) and how the HOA classifies the property.   
  • July 30 2012
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@brian Goetz: I went through the condominium declaration that was provided to me by the builder and out there it says. 
"the condominium will be a single family residential community comprised of detached single family homes" 
where can I find title records?.. this is new construction.
  • July 30 2012
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the broker is mis-leading you. A single family detached condominium, often referred to as a site condominium, does not carry any LLPAs (price adjustments); the pricing is the same as if you were buying a regular home.

There can be no common walls, meaning the house is truly detached; if there is a garage it cannot be attached to another property either.

Here is the price adjustment list (LLPA table) right on the Fannie Mae web site, go to table 3, you'll see the adjustment for condominiums specifically excludes detached condominiums.

https://www.efanniemae.com/sf/refmaterials/llpa/pdf/llpamatrix.pdf


  • July 30 2012
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The property you are describing sounds like a detached condominum.  It may look like a single family, but classified as condo  If the county records classifies the property as a condominium, it would affect how the underwriter classifies the property and ultimately the interest rate offered.   
  • July 30 2012
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Detached condos always cause confusion.   Most people don't know they are classified as condos until something like this comes up.  Title records usually clarify this.   The title records will determine what type of property it is. (who cares what the appraiser says, appraisers make a ton of mistakes)   Since it is classified as a condo, not a SFR, the rate and pricing is worse. This is not a "game" that the lender is playing to try to jack up your rate or fees. This would be applicable anywhere you went.

Most likely the broker gave you an initial estimate based on the information they received from you or your agent.   Since they were told incorrectly that the property was a SFR, they are not at fault.
  • July 30 2012
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