Non-Warrantable Condo Loan

Non-Warrantable Condo Loan & Non-Warrantable Condo Loan Financing

Bluestar Mortgage of Orlando is the trusted choice for Non-Warrantable Condo Loans and Financing. Give us a call at 321-400-5545 to speak with an FHA loan expert who can assist you in determining if a Non-Warrantable Condo loan is the right option for you.

Living in a condominium can be a great choice for several reasons. It can be a good option for property ownership without the stress of exterior maintenance. It may also be an economical way to live in a city or even a vacation hotspot without the cost of a full house.

Bluestar Mortgage is a mortgage expert in providing non-warrantable condo loans and financing in Florida. Finding a non-warrantable mortgage specialist in the state can be challenging, as many mortgage lenders do not offer options for non-warrantable condos.

What is a Non-Warrantable Condo?

A non-warrantable condo is a condominium unit or project that fails to meet the eligibility criteria set by government-backed entities, such as Fannie Mae and Freddie Mac. Consequently, obtaining a mortgage for these properties can be challenging since many lenders consider them high-risk. There are several reasons a condo may be classified as non-warrantable, including:

New construction
Lack of owner control over the Homeowners Association (HOA)
A high percentage of non-owner-occupied units
Allowing short-term rentals
A single entity owning more than 10% of the units
Ongoing litigation involving the building owner or developer

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Non-Warrantable Condo Mortgage Program Highlights:

Maximum 80% Loan-to-Value (LTV) [20% down payment] for Primary, Secondary, or Investment Properties
Loan amounts up to $6 Million
Minimum FICO score of 680
Debt-to-Income (DTI) ratio up to 50% with compensating factors
Adjustable Rate Mortgage (ARM) and 30-Year Fixed options available
Options for Purchase, Rate Term Refinance, Cash-out Refinance, and Debt Consolidation
Unit must include a kitchenette/kitchen with a full stove and oven
Homeowners Association must not restrict access days for the unit
Homeowners Association must maintain an acceptable reserves account
Homeowners Association must not be involved in any structural litigation
Non-warrantable condominiums, including condotel properties
Minimum loan amount of $200,000

Not Allowed:

Structural deficiencies and certain pending litigations
Incomplete construction of the subject phase
Units lacking a stove top and oven (must have both)
Homeowners Associations with $0 reserves
Homeowners Associations that limit the number of days the property can be accessed

Approved/Evaluated Case-by-Case:

Low HOA budget reserves or delinquencies exceeding 15%
Condos under 500 square feet (allowed at a maximum 70% LTV)
Condos with kitchenettes (including a full stove top and oven) are considered on a case-by-case basis

Non-Warrantable DSCR (Debt Service Coverage Ratio) Mortgage Option:

The Debt Service Coverage Ratio (DSCR) is a critical metric that assesses a property’s annual net operating income against its yearly mortgage debt, including both principal and interest. Lenders use DSCR to evaluate how much loan can be supported by the income generated from the property, determining the income coverage at a particular loan amount.

What Are the Requirements for a Non-Warrantable Condo Loan and Financing?

Minimum credit score: 660
Property type: Must be an Investment Property
Minimum down payment: 30% for Non-Warrantable Condos
Minimum Debt Service Coverage Ratio: 1%

Non-Warrantable Condo Bank Statement Mortgage Option:

Bank Statement Options:

12 or 24 Months of Personal Bank Statements accepted (using 100% of deposits)
12 or 24 Months of Business Bank Statements accepted (monthly net income from the P&L, or income after deducting a reasonable expense factor from total usable deposits)

Maximum LTV for Second Homes: 80% (20% down payment)
Maximum LTV for Investment Properties: 70% (30% down payment)
Minimum FICO Score: 680
Properties: Second Homes and Investment Properties allowed
DTI ratio up to 50% with compensating factors
Available options: ARM and 30-Year Fixed
Financing types: Purchase and Rate Term Refinance options available
Condotel properties included
Minimum loan amount: $200,000

Connect with a Bluestar Mortgage Non-Warrantable Condo Loan & Financing Expert

If you are interested in a non-warrantable condo loan, call us at 321-400-5545 to speak with a non-warrantable condo loan expert who can assist you in determining if a Non-Warrantable Condo loan is the right option for you.

Request A Free Consultation