Many months after the tragic collapse of the Florida beachfront condo building, condo buyers, sellers, lenders, and those buying condo loans are still feeling jittery.
How do we know if condo buildings are safe to live in and invest in?
Fannie Mae recently addressed these concerns by establishing new guidelines requiring home financing lenders and property appraisers to complete additional due diligence regarding the safety and integrity of condo and co-op projects.
To help deem a unit safe for inhabitance and investment, lenders must now dig into records concerning the entire project. According to Fannie Mae’s October 2021 Lender Letter, here’s some of what lenders need to look for:
Loans secured by units in condo and co-op projects with significant deferred maintenance or in projects that have received a directive from a regulatory authority or inspection agency to make repairs due to unsafe conditions are not eligible for purchase.
Additionally, projects that have failed to obtain an acceptable certificate of occupancy or pass local regulatory inspections or recertifications are not eligible.
We’ve got a condo review team in place
While this puts an additional workload on us, the lender, the goal is to help ensure the safety of our borrowers and investors – and we are wholeheartedly on board. We have our special condo review specialists team in place to execute the extensive due diligence.
What does this mean for you?
There are more details, regulations, exceptions, and special circumstances to learn about. Our home loan experts and condo review team are here to help you navigate the changes and ensure you have the knowledge to make informed choices about purchasing in condo and co-op buildings.
Equal Housing Opportunity. Axia Home Loans is a registered tradename of Axia Financial, LLC. NMLS 27830.