The Condominium Conundrum


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FHA Condo guidelines change in November, 2009 to align closer with existing Fannie Mae restrictions.

This may make financing for condominiums a little more difficult.

These are the slides from the online webinar, please feel free to contact us for questions or more information

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The Condominium Conundrum

  1. 1. The Condominium Conundrum <ul><li>Thank you for attending </li></ul><ul><li>We will begin in a moment </li></ul><ul><li>Class Scheduled to begin at 6:00pm </li></ul><ul><li>Homeownership Educator </li></ul><ul><li>Scott Schang </li></ul><ul><li>Branch Manager </li></ul><ul><li>Broadview Mortgage Corporation </li></ul><ul><li>1-866-667-6724 </li></ul>
  2. 2. Condominium Conundrum <ul><li>Purpose and Goals </li></ul><ul><li>Inform you of common challenges when trying to buy Condominiums </li></ul><ul><li>Educated you about upcoming changes that will make it even harder to buy Condominiums </li></ul><ul><li>Empower you with the ability to identify potential challenges and avoid wasting time & money </li></ul>
  3. 3. Condominium Conundrum <ul><li>Ask Questions throughout presentation </li></ul><ul><li>You may type questions in at any time during the presentation – Questions box on your screen </li></ul><ul><li>Homeownership experts are standing by to answer your questions during the presentation </li></ul><ul><li>This is an interactive learning environment. You will get the most value by having your specific questions answered </li></ul><ul><li>The only dumb question is the one you don’t ask </li></ul><ul><li>Write number down now in case you get disconnected </li></ul><ul><ul><li>1-866-667-6724 </li></ul></ul>
  4. 4. Condominium Conundrum <ul><li>Topics we will cover </li></ul><ul><li>What is a Condominium? </li></ul><ul><li>What you should know about living in a condominium </li></ul><ul><li>Common challenges with buying now </li></ul><ul><li>Changes that will make it harder to buy soon </li></ul><ul><li>What you can do to identify challenges early </li></ul>
  5. 5. Condominium Conundrum <ul><li>What is a Condominium? </li></ul><ul><li>“ Condominium” is a form of ownership and refers to the legal structure of the living community – not the living unit itself </li></ul><ul><li>You own in whole, the “Walls in” and have a shared ownership in the entire community </li></ul><ul><li>Your Homeowner’s Association Dues (HOA) help to pay for and maintain all common areas </li></ul><ul><li>Condominiums can be attached or detached </li></ul><ul><li>Townhome typically describes type of unit </li></ul><ul><ul><li>Usually 2 story </li></ul></ul><ul><ul><li>No other units above or below </li></ul></ul>
  6. 6. Condominium Conundrum <ul><li>What you should know </li></ul><ul><li>There is a “Rule Book” – CC&R’s </li></ul><ul><ul><li>Conditions, Covenants & Restrictions </li></ul></ul><ul><li>The Homeowner’s association board of directors is the governing body in terms of community affairs </li></ul><ul><li>The board of directors is an elected position from amongst community members </li></ul><ul><li>The homeowner’s association is responsible for managing the finances of the community as a whole </li></ul>
  7. 7. Condominium Conundrum <ul><li>Common Challenges </li></ul><ul><li>This market has created challenges for buyers looking to get bank financing on Condos </li></ul><ul><li>Condominium project must appear on an approved list to qualify for Fannie Mae (non FHA) Loan </li></ul><ul><li>Community must be 50% owner occupied to qualify for financing </li></ul><ul><ul><li>Not vacant or Investor owned </li></ul></ul><ul><li>If more than 15% of HOA delinquent – no financing </li></ul><ul><li>If there is unresolved litigation against HOA – no financing - reviewable </li></ul>
  8. 8. Condominium Conundrum <ul><li>New Challenges </li></ul><ul><li>On November 2 nd , 2009 – FHA to adopt stricter guidelines for Condo’s to match Fannie Mae </li></ul><ul><ul><li>Must be 50% owner occupied </li></ul></ul><ul><ul><li>Cannot have unresolved litigation </li></ul></ul><ul><ul><li>More than 15% HOA delinquency not eligible </li></ul></ul><ul><li>Condos using FHA financing could be “Approved” on a case by case basis – Spot Approval </li></ul><ul><ul><li>No longer available starting November 2 nd </li></ul></ul><ul><li>New construction condominium project guidelines more strict as well </li></ul>
  9. 9. Condominium Conundrum <ul><li>How to Identify Challenges </li></ul><ul><li>Knowing what can prevent financing can help you identify challenges more quickly </li></ul><ul><li>Get HOA information prior to making offer - Agent </li></ul><ul><li>Check Fannie Mae and FHA approved Condo lists online – see link on follow up email </li></ul><ul><li>Have your Realtor communicate with Seller/Agent </li></ul><ul><ul><li>Inquire about other offers that may have fell out </li></ul></ul><ul><ul><li>Inquire about known challenges with financing </li></ul></ul><ul><li>Have your lender call HOA to inquire </li></ul><ul><li>Order HOA Cert ASAP - $75 - $175 </li></ul>
  10. 10. Condominium Conundrum <ul><li>Wrap up and Take Aways </li></ul><ul><li>We are a direct Lender that specializes in CalSTRS, CalPERS, CalHFA, FHA, VA, USDA and Community based down payment assistance programs </li></ul><ul><li>We would love an opportunity to earn your business, we truly have an expertise in this program - we work with it every single day </li></ul><ul><li>We are more than happy to be your “second opinion” if you are already working with someone </li></ul><ul><li>We are more than happy to recommend you to a qualified Real Estate Agent that shares our values and passion for education - familiar with CalSTRS </li></ul>
  11. 11. Thank You for Attending If you enjoyed this class – Tell a friend  <ul><li>Please tell us how we’re doing </li></ul><ul><li>Follow up email includes a link to “Praise” page </li></ul><ul><li>Your feedback is greatly appreciated </li></ul><ul><li>For more information </li></ul><ul><li>1-866-667-6724 </li></ul><ul><li>Homeownership Educator </li></ul><ul><li>Scott Schang </li></ul><ul><li>Branch Manager </li></ul><ul><li>Broadview Mortgage Corporation </li></ul>