Posted by Financing a condo is different from financing a single family home. Why you ask? It is due to Arizona Mortgage Lender’s requiring the entire condo project be eligible for home loan financing.
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Condo Home Loan Differences
Just how complex is getting a condo home loan? The answer depends upon a myriad of factors. However, condensed down to a simple answer we are left with 2 vastly different levels of difficulty. Regarding condo home loans, the levels of difficulty depends on which condo approval process is used. The 2 condo approval processes are:
- Limited Condo Review
- Full Condo Review
As you may have guessed, Limited Reviews are simpler than Full Reviews. Limited Reviews do not require the level of information that a Full Review does. So who chooses which Review type is required? The answer is simple – Conventional loan regulations.
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Team@JeremyHouse.com
602.435.2149
Condo Approval – Limited Review Eligibility
Home loans meeting specific Loan to Value (or “LTV”) limits can use the Limited Review process. LTV refers to how much a buyer borrows compared to the value or price of the condo. For example, when a borrower buys a condo for $300,000 and they borrow $240,000, their LTV is 80% ($240,000 is 80% of $300,000). LTV limits for Limited Condo Reviews are:
- Owner Occupied: 90%
- Vacation Home: 75%
- Rental Property: 75%
By Jeremy House
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Great post. I am going through some of these issues as well..