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NON	  WARRANTABLE	  FINANCING	  FOR	     CONDOMINIUM	  AND	  CO-­‐OP:	                  Does	  it	  exist?	             Pr...
Na=onal	  Condo	  Advisors,	  LLC:	  The	  na7on’s	  premier	  condominium	          project	  approval	  service	        ...
Overview	  •    Defini7on	  of	  non-­‐warrantable	  •    Typical	  compliance	  issues	  •    Individual	  lender	  approv...
Non-­‐Warrantable:	  Defini=on?	  	  •  Fannie	  Mae	  project	  approval	  •  FHA	  project	  approval	  •  VA	  project	 ...
Typical	  Compliance	  Issues:	  	                    The	  Most	  Common	  •    Pre-­‐sale	  •    10%	  budget	  reserve	...
Typical	  Compliance	  Issues:	  •  Excessive	  rental	  percentage	  •  By-­‐law	  leasing	  restric7ons	  •  Affordable	 ...
Individual	  Lender	  Approval	  •  Condominium	  alterna7ves	  •  Coopera7ve	  alterna7ves	  •  Sponsor	  financing	  op7o...
Loan	  Expecta=ons	  •  Interest	  rate	  increases	  •  Available	  loan	  types	  •  Lower	  loan	  to	  value/Increased...
Lender	  Products	  •    25%	  Pre-­‐sale	  for	  new	  construc7on	  •    35%	  Pre-­‐sale	  for	  all	  property	  types...
What	  Do	  Lenders	  Want?	  •  Bulletproof	  compliance	  •  Excessive	  reserves	  •  Accurate	  appraisals	  
Planning	  •    Work	  with	  the	  end	  in	  mind:	  agency	  approval	  •    Gegng	  agency	  approvals	  by	  complian...
Thank	  you!	  	                                                                             Ques=ons/Comments?	  *Na7onal...
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Non Warrantable Financing

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Details about the what, why and hows of non-warrantable financing for condominiums. Learn about products and services from various lenders and what's right for your development.

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Transcript of "Non Warrantable Financing"

  1. 1. NON  WARRANTABLE  FINANCING  FOR   CONDOMINIUM  AND  CO-­‐OP:   Does  it  exist?   Presented  by:  Orest  Tomaselli,  CEO     Na7onal  Condo  Advisors,  LLC  
  2. 2. Na=onal  Condo  Advisors,  LLC:  The  na7on’s  premier  condominium   project  approval  service   www.na7onalcondoadvisors.com   Ph.  888-­‐726-­‐6361  
  3. 3. Overview  •  Defini7on  of  non-­‐warrantable  •  Typical  compliance  issues  •  Individual  lender  approvals  •  Loan  expecta7ons  •  Lender  products  •  What  do  lenders  want?  •  Planning    •  Consul7ng  by  advisory  team  
  4. 4. Non-­‐Warrantable:  Defini=on?    •  Fannie  Mae  project  approval  •  FHA  project  approval  •  VA  project  approval  Non–warrantable  condominiums  and  coopera=ves  are  those  proper=es  which  do  not  and  cannot  meet  the  standards  set  forth  by  Fannie  Mae,  FHA  and  the  VA  for  end  loan  lending  to  occur.    
  5. 5. Typical  Compliance  Issues:     The  Most  Common  •  Pre-­‐sale  •  10%  budget  reserve    •  Reserve  funding  •  Excessive  sponsor  unit  ownership  •  Single  investor  ownership  above  10%  •  Li7ga7on  and  construc7on  deficiency  
  6. 6. Typical  Compliance  Issues:  •  Excessive  rental  percentage  •  By-­‐law  leasing  restric7ons  •  Affordable  housing  component  •  Fannie  Mae  by-­‐law  compliance  (Form  1054)  •  FHA  foreclosure/bankruptcy  moratorium  “One  year  aging  required  from  the  date  of  bankruptcy  discharge,  termina7on  of  receivership,  issuance  of  foreclosure  judgment  or  execu7on  of  deed-­‐in-­‐lieu”.  (ML  2011-­‐22,  page  23)    
  7. 7. Individual  Lender  Approval  •  Condominium  alterna7ves  •  Coopera7ve  alterna7ves  •  Sponsor  financing  op7ons  
  8. 8. Loan  Expecta=ons  •  Interest  rate  increases  •  Available  loan  types  •  Lower  loan  to  value/Increased  down  payment  
  9. 9. Lender  Products  •  25%  Pre-­‐sale  for  new  construc7on  •  35%  Pre-­‐sale  for  all  property  types  •  Jumbo  alloca7ons  •  Non-­‐gut  rehab  lending:  excluding  rent  regulated  units  •  Excessive  commercial  
  10. 10. What  Do  Lenders  Want?  •  Bulletproof  compliance  •  Excessive  reserves  •  Accurate  appraisals  
  11. 11. Planning  •  Work  with  the  end  in  mind:  agency  approval  •  Gegng  agency  approvals  by  compliance  •  Waivers  aher  the  ini7al  sales  period  •  Alterna7ve  planning  •  Professional  consulta7on:  why  the  lender  consult  might   not  work  for  your  development  
  12. 12. Thank  you!     Ques=ons/Comments?  *Na7onal  Condo  Advisors,  LLC  is  not  a  law  firm.    None  of  the  guidance  or  advice  contained  within  should  be  considered  or  construed  as  legal  advice  from  either  NCA  or  any  of  its  employees.    We  recommend  you  consult  with  your  ajorney  regarding  the  informa7on  provided  within.  
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