Saturday, April 18, 2009
Fannie Mae has implemented tighter restrictions for condo loans as of January 15th 2009. The new rules are designed to make condo loans a more safe investment.
The headlines of these new rules are as follows: 1) To qualify for a Fannie Mae loan, 70 percent of the sales for new or newly converted condominium projects must be sold to a purchaser as a principle residence or second home (not investor). 2) For existing condo projects, no loans will be approved if more than 15% of the total units are more than 30 days past due on their condo association fees.
As of April 1st of this year, Fannie Mae is also adding an additional fee of 0.75% of the total loan amount on certain loans secured by a condo. This fee will apply on loans that have under 25% for a down payment. It is not clear what this fee will be used for except to encourage people to put more money down.
The headlines of these new rules are as follows: 1) To qualify for a Fannie Mae loan, 70 percent of the sales for new or newly converted condominium projects must be sold to a purchaser as a principle residence or second home (not investor). 2) For existing condo projects, no loans will be approved if more than 15% of the total units are more than 30 days past due on their condo association fees.
As of April 1st of this year, Fannie Mae is also adding an additional fee of 0.75% of the total loan amount on certain loans secured by a condo. This fee will apply on loans that have under 25% for a down payment. It is not clear what this fee will be used for except to encourage people to put more money down.
Labels: Lending rules for condos change
