Fannie Mae's new condo loan guidelines cause fear, frustration ...

Full story: Chicago Tribune

Money is already tight at The Wilshire Condominium, and new lending rules threaten to make life even more difficult for it and other condos around the country.
Comments
1 - 20 of 43 Comments Last updated Apr 5, 2011
First Prev
of 3
Next Last
Discouraged

San Francisco, CA

|
Report Abuse
|
Judge it!
|
#1
Mar 27, 2009
 
I thought that I had financing for a condo purchase that was supposed to close next week. Instead, I got a cold email from the bank that my loan was being rejected because the condo project didn't meet the 15% delinquent fees threshold. The lender had already granted an exception to the 70% owner-occupancy ratio (the building is at 66%, but 3 units are vacant, and it's only a 47 unit building). My mortgage broker and realtor were caught completely unaware about this new requirement. No lender would pick up the loan even when I was willing to put down 20%. That building has 3 vacant units, and I don't know how they're going to be able to fill them. Unfortunately, I had already removed my loan contingency, so I'm pretty sure I'll lose my earnest money deposit. It's so frustrating--I thought I would be moving into my very first home next week.
poor buyer

San Diego, CA

|
Report Abuse
|
Judge it!
|
#2
May 14, 2009
 
Oh, I have the same situation as you. My loan suppose to be closed by yesterday. However, the lander called me and told me that my loan had been rejected by the underwriter, according to the Fannie Mea guide line. The reason they reject my loan is there is 1% hoa delinquency over the guide line 15%. I don't know is there any where I can borrow money from. Very frustrated.
again

Spring Hill, FL

|
Report Abuse
|
Judge it!
|
#3
May 18, 2009
 
Similar story to above - a re-fi attempt on my condo, cost me $500 in non refundable application fee, complex is FHA approved but not fannie mae compliant. How can one attempt to refinance without taking a $500 roll of the dice? Lenders should be up-front about requirements.
firstfederal

Elgin, IL

|
Report Abuse
|
Judge it!
|
#4
May 18, 2009
 
M--her F---ers!
Steve

Los Angeles, CA

|
Report Abuse
|
Judge it!
|
#5
Jun 12, 2009
 
Discouraged wrote:
I thought that I had financing for a condo purchase that was supposed to close next week. Instead, I got a cold email from the bank that my loan was being rejected because the condo project didn't meet the 15% delinquent fees threshold. The lender had already granted an exception to the 70% owner-occupancy ratio (the building is at 66%, but 3 units are vacant, and it's only a 47 unit building). My mortgage broker and realtor were caught completely unaware about this new requirement. No lender would pick up the loan even when I was willing to put down 20%. That building has 3 vacant units, and I don't know how they're going to be able to fill them. Unfortunately, I had already removed my loan contingency, so I'm pretty sure I'll lose my earnest money deposit. It's so frustrating--I thought I would be moving into my very first home next week.
I had the same thing happen to me! I also removed my loan contingency and unfortunately have to either pay cash or lose my $13K deposit. This is so unfair when the lender was not up front with all their requirements!!! This has to be changed!!
Bok

Arlington Heights, IL

|
Report Abuse
|
Judge it!
|
#6
Aug 13, 2009
 
Im so scared that this may happen to me also. Im just waiting for the bank to inform me if the condo project is approved or not. I basically have an approved credit and all but the last step was to have the condo project go thru an approval!!! I recently found out about this Fanniemae guidelines and I checked the deliquency in the HOA its way over 15%!!! I just wish they give an exception!! It will be so frustrating if it gets denied! not to mention losing almost $600 for the application!
jlaz

Methuen, MA

|
Report Abuse
|
Judge it!
|
#7
Nov 10, 2009
 
We have experience on the other end. We are selling a condo and the buyer has ran into criteria rejections twice.. Until finally he is gonna pony up 15% and the loan still might not go through. Its frusteration for both parties because we will lose out on the homes we both wanna buy.... and it is all because the developer has yet to turn over the rights to the condo owners. Someone sits in a room and yay or nay these condo questionaires not even knowing what the look like.. Its not fair that we bailed out these banks and now they wont lend to qualified buyers...
Scotty

Bakersfield, CA

|
Report Abuse
|
Judge it!
|
#8
Nov 28, 2009
 
I am in escrow on a beach condo and have 25% down perfect credit bank approval but woooops the condo project has 44% owner occupancy. I was approved at 5% with zero points. I have found a loan at 6% with three point plus $1500. Its robbery. It will take a cash buyer to buy these condos and while there are some out there there are not that many. I forsee the condo market in California going in the toilet by about 60%
Loan Man

Woburn, MA

|
Report Abuse
|
Judge it!
|
#9
Dec 16, 2009
 
again wrote:
Similar story to above - a re-fi attempt on my condo, cost me $500 in non refundable application fee, complex is FHA approved but not fannie mae compliant. How can one attempt to refinance without taking a $500 roll of the dice? Lenders should be up-front about requirements.
As a lender for 25 years the guideline changes are coming in fast . We all do our best. The best way to protect yourself is having a home owners form filled out by the management co to see if it qualifies . It will give you all the details about delinquency , o oc ratio and insurance . Any lender you are dealing with should do this first before taking your money
Colleen

Bronx, NY

|
Report Abuse
|
Judge it!
|
#10
Dec 18, 2009
 
I was having a lot of trouble getting financing on the condo upstairs that I love. I finally found someone who could get me a loan, but it was an FHA loan and the lady I was buying from told me FHA wouldn't do it, if they would it would take a long time. I actually got an approval, but then, because my boyfriend owns the place we live and I was buying the place upstairs, the bank said there was an occupancy issue. They didn't believe we were going to live there. I guess I can understand why they would think that, but I really wanted to move in the new one, it was much nicer and I was picking it up for about 100K less than my boyfriend owes on the mortgage here. So if you are defiantly going to be living there I am sure Wes could help. I don't have his number off the top of my head, but I do have his email:

wjamison@topdot.com

He is really cool and helpful. It anyone finds a place that will finance me and believe that I am moving in, please let me know.
John Chen

United States

|
Report Abuse
|
Judge it!
|
#11
Mar 12, 2010
 
I am more than happy to put 25% or even 30% for an investment property, if anybody can finance a community w/ 20%, and I will be happy w/ 6% interest.

Please let me know. My email is: john.da.chen@gmail.com
stephanie

Lewisberry, PA

|
Report Abuse
|
Judge it!
|
#13
Apr 7, 2010
 
I was supposed to close on my refinance mortgage today, instead I got a call that the loan did not meet FHA requirements! What requirements ! I have been waiting a Month for this mortgage. I can't even sell my home now. I lose everything. What the hell is going on?
Chris

Big Sandy, TX

|
Report Abuse
|
Judge it!
|
#14
Apr 13, 2010
 
You lost your $500 because you went through lending tree or quicken loans. Both of these companies charge upfront promising everything and then fail for one reason or another.

You never get your money back and worst part is they know they can't do it but still take your money then say no. So dishonest.
Lee

Upper Marlboro, MD

|
Report Abuse
|
Judge it!
|
#15
May 1, 2010
 
I'm having the same problem. Supposed to close this coming week, but got a phone call saying the HOA delinquency is at 18%. It comes down to 4 people needing to pay their dues. I'm really hoping it works out, considering I have my EMD in this place already, not to mention the home inspection and appraisal fees. :-/
Stefanie

Downers Grove, IL

|
Report Abuse
|
Judge it!
|
#16
May 13, 2010
 
Does anyone know if this is happening to HomePath mortgages as well? Very few lenders are doing HomePath loans for condos, but I found a bank that would, and now I'm considered it will get rejected at the last minute.
vectus

Miami, FL

|
Report Abuse
|
Judge it!
|
#17
May 14, 2010
 
Stefanie wrote:
Does anyone know if this is happening to HomePath mortgages as well? Very few lenders are doing HomePath loans for condos, but I found a bank that would, and now I'm considered it will get rejected at the last minute.
Homepath loans are offered on non-conforming condos that are Fannie Mae foreclosures. I'm not so sure that Fannie Mae wouldn't take a cash offer over an offer backed by Homepath financing, even if the cash offer comes in a bit lower. Cash is King these days, especially with foreclosed condos.
Craig

Grand Rapids, MI

|
Report Abuse
|
Judge it!
|
#18
May 21, 2010
 
I am in the same position. The condo I've signed a purchase agreement for has a hotel on the first 7 floors of the building's 32 floors. I'm not even asking for a large loan, putting down 70% of purchase price and the banks still won't give me what essentially is the cost of a new Audi A4. The new laws are getting out of control. How do they expect people to purchase homes if their standards are too strict? If anyone has any luck getting a loan please let me know csearer09@gmail.com.
Anousheh

San Francisco, CA

|
Report Abuse
|
Judge it!
|
#19
May 24, 2010
 
I have a buyer that is trying to purchase a condo in a complex with 17% HOA delinquency. He is putting down over 50% downpayment and have an excellent credit and income. Is there a lender who gives him a loan? I love to save this short sale deal that I waited for a lender's approval over 4 months. My e-mail address is anousheh.massoumi@gmail.com
Jen

Philadelphia, PA

|
Report Abuse
|
Judge it!
|
#20
Jun 21, 2010
 
after reading everyone's comments, I'm glad I'm not alone. I'm the seller of a condo. We're under contract and the buyers already had an inspection/appraisal. We should have gotten a closing date till our agent revealed that the buyers' FHA lender rejected their loan b/c our condo association has a single investor with more than a 10% stake in the units, which is now against FHA guidelines. I can't believe it! Isn't it unamerican to penalize someone for investing and essentially helping the housing market? What's wrong with this picture? We are good people who have NEVER missed a mortgage payment and we're getting screwed! The buyers' loan officer is hoping to try and get another lender so I'm trying to be optimistic but it's so hard! Does anyone have a success story? I need to know there's still hope! All we want to do is sell our condo and buy a house!
CitiMortgage Frustration

Oxnard, CA

|
Report Abuse
|
Judge it!
|
#21
Jun 25, 2010
 
firstfederal wrote:
M--her F---ers!
Add CitiMortgage to the list of M--her F---ers! When we applied for a refinance (CitiMortgage had the current loan), we were told not to worry about the Condo/PUD Project Questionnaire because we were going to be "Fast Tracked". Three months and two scheduled closings later, we were told we needed the Questionnaire, and we needed a Fannie Mae approval. Considerable time, effort, and money wasted! If CitiMortgage would have been up front with the Fannie Mae requirement, we would have known not to proceed, and saved application fees, copy fees, fax fees, and the fee for the Condo/PUD Project Questionnaire.

Tell me when this thread is updated: (Registration is not required)

Add to my Tracker Send me an email

First Prev
of 3
Next Last

Add your comments below

Characters left: 4000

Please note by submitting this form you acknowledge that you have read the Terms of Service and the comment you are posting is in compliance with such terms. Be polite. Inappropriate posts may be removed by the moderator. Send us your feedback.

•••
•••
•••

Miami Jobs

•••
Enter and win $5000
•••

Miami People Search

Addresses and phone numbers for FREE

•••

Miami News, Events & Info

Click for news, events and info in Miami
•••

Personal Finance

Mortgages [ See current mortgage rates ]
•••