condo purchases have underwriting rules that single family homes do not

Buying a condo? Don’t skip the project-level approval step. Unlike single-family homes, condos must be “warrantable” for most Conventional and FHA loans. Lenders and FHA rules limit investor-owned units, HOA delinquency, ongoing litigation, percentage of commercial space, and require adequate reserves. A seemingly affordable unit can become unfinanceable if the project fails these standards. FHA-approved condo lists are public; Conventional approval is done by lender review. If a project isn’t warrantable, you’ll likely need a portfolio loan with higher rates and bigger down payment. Before falling in love or signing a contract, verify the project’s status for the loan type you plan to use. Know this early to avoid surprises. Ken Claude | SC Real Estate Broker-in-Charge & Licensed Loan Officer | Carolina Coastal Realty Group, LLC | Summit Lending Group | NMLS #2476547 | 843-900-1254 | Equal Housing Lender | Powered by C2 Financial Corporation.

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