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Non-Warrantable Condominiums
(Wholesale)
Eligible Transactions • Back Home
• Expanded Ratio
• Asset Advantage
• Alternative Document
• Owner Occupied Principal Residences
Ineligible Transactions • Incomplete projects including common areas
• Structural or environmentaldefects
• Projects with inadequate insurance
• Projects with little or no establishedreserves
• Timeshares
• Projects consisting of manufacturedhousing
• Investment & Second Homes
Required Documentation • Appraisal
• Condo Questionnaire
• Master Insurance Policy for the project
• Current operating budget
• CPM results must be provided with submission of loan credit documents (Loan Number Required)
• The Condo Review will be initiated by a Oaktree Underwriter simultaneouslywith the credit review
Project Status • Established Condominium only
• All units, common elements, and facilities within the project phase must be complete. Additional phasing is not considered in review
Presale • At least 60% of the total units must be sold or under contract.
• Pending sales may be included to meet the 60% presale requirements
Pending Litigation • Reviewed on a case by case basis
• For litigation involving constructiondefects can be considered with the following:
•Repairs have been made to the project and HOA is recouping costs from contractor that completed the work
•Repairs that present no safety or environmentalconcerns where the HOA has adequate cash reserves to complete the required repairs
Insurance • The insurance policy is in the exact name of the condominium association
• Policy includes a replacement cost endorsement for the hazard coverage on common structures with a deductible not to exceed 5% of the policy face value
• If the Established project consists of 20 or more units, Fidelity insurance was obtained and the amount of coverage is equal to at least 3 months combined assessments to the association.
• HOA maintains a Master or Blanket type of insurance policy for the subject condominium project only; and the policy is not a Blanket policy that covers multiple
unaffiliated condominium association projects or is a self insurance arrangement whereby the owners' Association is self insured or has merged with other unaffiliated Associations to self
insure all of the general and limited common element of the various associations
• Policy meets the higher of state required liability coverage or $1 million general liability coverage for homeowners' association.
• Policy includes flood insurance (only if common structures located in flood zone) with a deductible that is not greater than $25,000 of the policy face amount unless state law allows for a
higher deductible - Attach an explanation if accepting state-mandated higher deductibles.
Single Entitiy Ownership • No single entity, individual, or group may own more than 20% of the total units in the project
• Maximum 10% Oaktree exposure to any one project
Condotel • NOT PERMITTED
Budget • The budget must be adequate, provide for funding of replacement reserves for capital expenditures, deferred maintenance (at least 10% of the budget) and funding for insurance deductible
• 10% reserve allocation as a line item on the budget can be waived if cash on hand exceeds 20% of total operating income
• Non-incidental income from operations owned or operated by the HOA are allowed with the following requirements
• Business operation does not have an adverse impact of the financial stability of the project (example: business is operating at a loss)
• Business operation is conducted legally and in compliance with local laws and regulations
HOA Deliquencies • No more than 25% of the unit owners may be more than 30 days delinquent
• Delinquency requirement can be waived if HOA has cash on hand that exceeds 30% of the total operating income,

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Commercial Influence • There is not defined maximum commercial influence. The appraiser must confirm that the commercial influence is common and customary to the market and does not have any adverse
impact on the marketability as a residential unit
Condo Conversions • Projects are eligible without for non-gut rehab transactions less than three years subject to inspections report favorably commenting on the following:
•Structural integrity of the project
•Condition and remaining useful life of the major components such as the heating and cooling systems, plumbing, electrical systems, elevators, boilers, roof.