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Condo Project Approvals and How They Can Directly Impact You


Many of today’s consumers are realizing that the lenient banking guidelines of the good old days during the mid 2000’s are long gone and in their place are much more stringent requirements. Let me preface this article by saying that this is somewhat of a high level overview and I will have future pieces which go deeper into the nuts and bolts of specific condo project approvals.


How Existing Home Owners are Directly Impacted by Condo Project Approvals:


Lets assume that you purchased your home a few years back with a conventional mortgage at a 6% interest rate. I think its fair to assume that most folks would love to take advantage of today’s historically low interest rates Now before you can qualify for a refinance Cheap Jimmy Foxx Jersey , your project will need to be deemed “approved” by the mortgage company, AKA, determine if the building meets Agency guidelines. The “Agency” we’re referring to is typically Fannie Mae. This is where things may get tricky since what was once deemed “approved” in 2005 may very well not be approved in today’s much tougher lending arena. Its always best to check with your lender first to see if a project is approved already being before proceeding with the loan application.


Condo Project Approvals and Sellers of Properties:


Many would agree that when we look up and down our streets today, it seems like there are more people trying to sell their homes than ever before. Everywhere we look Cheap Chuck Klein Jersey , there are more and more “For Sale” signs popping up. You may be wondering how condo project approvals affect those sellers listing their homes for sale. The Answer: If the project never gained FannieMae or FHA approval, how are any new buyers supposed to get approved in today’s lending inviornment? The verdict is that it will be difficult because pretty much every bank will require the project to be approved before the borrower can obtain financing. The first question on every home buyer’s list should be whether the condo project is “approved”. Also, if roughly half of all homeowners are using FHA financing these days, this means that all potential buyers of the property are immediately cut in half if there is only a “Conventional” (Fannie Mae) condo project approval in place rather than both Conventional and FHA. As a rule of thumb Cheap Richie Ashburn Jersey , if you are considering buying, selling, or even just refinancing, first investigate whether the condo project approvals currently in place. Consider calling a qualified mortgage banker who can help you get the project approved in the event that there were never condo project approvals put in place Cheap Jake Arrieta Jersey , or, in the event that the condo project approvals are expired. It is rare to find mortgage companies that are true experts in condo project approvals but there are a few out there and you just need to find them. Always have your condo project approvals done before your property is listed for sale and this will really improve your likelihood of selling the home, and will also help set apart your property from the crowd.


Property Buyers and Condo Project Approvals – How are They Related?


Let us imagine that you are out hunting for your perfect property downtown and you have narrowed things down to the best neighborhood, close to your favorite bars Cheap Aaron Nola Jersey , and even near the ballpark. Its likely that condo project approvals are the last thing you are considering, right? Once you discover the project is not eligible for financing, you may be very disappointed. Some projects may no longer be eligible for financing since lending guidelines have become so much tougher these days. As recently as 2006, on newly built projects (which include condo conversions) Cheap Andrew McCutchen Jersey , you didn’t even need a single unit sold before convnetional closings could begin. Simply put, condo project approvals back in the “good ol days” before any units were under contract, or, “sold” and the builder was in charge of seeing the sales through to the end. In today’s world Cheap Rhys Hoskins Jersey , all FannieFreddie mortgages must meet project approval guidelines which require more than half of the total units to be pre-sold before the first closing can take place. What?! you might be asking? This means a highrise must have 101 out of 200 total units under contract to real individual buyers before the actual settlements can begin. Now to be fair there are a couple tricks developers try using to get around this such as “phasing” the project when ever possible. Prior to the 51% “pre-sale” threshold being met, a select few local banks may step up and fund private mortgages to help cover the gap between 0% sold and the Fannie-required 51% sold. The down side is that these private mortgages typically have unfavorable terms, are adjustable, and typically hold higher rates vs their FannieFreddie versions. It should be noted that HUD has stepped up their efforts to help the condo industry by temporarily reducing the presale requirement on the FHA program form 51% down to 30% on new construction projects Cheap J. T. Realmuto Jersey , I have not seen much of an immediate positive impact from this enhancement as of yet. Before putting an offer on your next home, be sure to check into the building’s condo project approvals to save yourself a lot of headaches and wasted time.


In conclusion, always make sure the building’s condo project approvals are in place, regardless of whether you are a buyer Cheap Maikel Franco Jersey , a seller, or even just engaging in a conventional refinance.


Author Joe Karns is sales and marketing leader dedicated to bringing his subscribers relevant and useful information. Want a free consultation from a true industry professional about your condo project? Check out Joe Karns at the following link for more informat