Fannie Mae has revised their condo guidelines – Ouch!
12/17/2007 – 8:54 pmMost notable is the elimination of Investor Loans for all condos.
· Loans secured by units in new condominium projects are no longer eligible. A new project is a project in which (a) fewer than 90 percent of the total units in the project have been conveyed to the unit purchasers; (b) the project is not fully completed (such as proposed construction, new construction, or the proposed or incomplete conversion of an existing building to a condominium); (c) the project is subject to additional phasing or annexation; or (d) control of the homeowners’ association has not been turned over to the unit owners.
· Loans secured by units in established condominium projects are limited as follows (unless a lower limit applies according to program guidelines):
o The LTV and CLTV for Primary Residence loans are limited to:
§ Agency eligible with DU Approve or LP Accept recommendations: 90%
§ Agency eligible with DU Expanded Approval (EA) recommendations: 75%
§ All others: 80% (including all Alt A programs, LP A Minus and manually underwritten agency eligible loans)
o The LTV and CLTV for Second Home loans is limited to 75% for all programs.
o Investment Property loans are no longer eligible for any program.