Connect with us

Real Estate

Ask the expert: We are retiring and thinking of buying a condo in a building we have long admired. Is this going to be hard to finance?

Published

on

Condos can be more difficult to finance than single family homes, but the key to getting a conventional loan is in the building itself.

Remember that when you buy a condo, your mortgage company (and you) are placing trust in the whole building, not just your unit.

For this reason, buildings must meet some standards. Here are a few:
– Common areas must be completely finished and owned by the unit owners or the Home Owners Association.
– At least 51 percent of all the units must be owner-occupied or second homes.
– The building must maintain an adequate budget to run the property.
-At least 90 percent of the units must be sold and currently owned by unit owners.
– A single entity can’t own more than a certain percentage of the building.
– Unit owners must be keeping up with their association dues.
– The condo project must be covered by adequate insurance.

If the condominium project is established and known to meet guidelines, and you are a credit worthy borrower, you will probably have little difficulty getting a conventional loan.

Keep in mind that in calculating your debt-to-income ratio for the loan, lenders will count your HOA fees as part of your total monthly expenses.

As usual, you can save on mortgage insurance by putting at least 20 percent down.

When you buy a condo, you are buying into the HOA and you are sacrificing some privacy for convenience. It’s a good idea to take a look at the minutes from the HOA meetings to see the sorts of issues being discussed.

When the building qualifies and you find the property suitable, financing a condo should be much the same as a conventional home.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

King Cartoons

Upcoming Events

Jun
21
Thu
all-day Shoe Drive Fundraiser @ Living Water Christian Church
Shoe Drive Fundraiser @ Living Water Christian Church
Jun 21 all-day
Shoe Drive Fundraiser @ Living Water Christian Church
Living Water Christian Church is holding a shoe drive fundraiser to help with their backpack mission.  Help us to raise funds for our organization by donating gently worn, used, and new shoes! You can also[...]
5:00 pm Annual Wine Pull @ Blue Wing Frog
Annual Wine Pull @ Blue Wing Frog
Jun 21 @ 5:00 pm – 7:00 pm
Annual Wine Pull @ Blue Wing Frog
Annual Wine Pull | Thursday June 21st from 5:00 to 7:00 @ Blue Wing Frog on Chester Street. Every Ticket purchase includes, food, a glass of wine and a bottle of wine or wine tasting[...]
8:00 pm Gazebo Flix @ Village Commons
Gazebo Flix @ Village Commons
Jun 21 @ 8:00 pm – 10:00 pm
Gazebo Flix @ Village Commons
Family-oriented movies shown outside. Bring a lawn chair or blanket and enjoy! Movie starts at dusk. MOVIE SCHEDULE: June 7th – Jumanji  (sponsored by MetroPCS) June 14th – Frozen  (sponsored by Aire Serv Heating & Cooling) June[...]
Jun
22
Fri
5:00 pm Art in the Valley’s Grand Opening @ Art in the Valley
Art in the Valley’s Grand Opening @ Art in the Valley
Jun 22 @ 5:00 pm – 9:00 pm
Art in the Valley's Grand Opening @ Art in the Valley
Front Royal, VA – Art in the Valley, a fine art gallery and studio located at 205-A East Main St. in Front Royal has its grand opening on Friday, June 22nd from 5pm to 9pm.[...]
7:00 pm Gazebo Gatherings @ Village Commons
Gazebo Gatherings @ Village Commons
Jun 22 @ 7:00 pm – 9:00 pm
Gazebo Gatherings @  Village Commons
Gazebo Gatherings Summer Concert Series is presented by the Blue Ridge Arts Council and sponsored in partnership with the County of Warren, the Town of Front Royal and the Virginia Commission for the Arts. Bring[...]