navigating how to mortgage property that isn’t tangibly real in the eyes of the law. As such, many lenders simply refuse to lend on co-ops. Co-ops are just too complicated. If your buyer is buying a co-op, make sure your lender is well-versed in co-op loans or you might not even make it past the origination stage. Rural Properties: While the USDA provides very favorable loan terms for houses that are in rural areas, rural properties can still be challenging to finance. One of the main reasons it’s difficult is because it’s harder to get insurance. For example, a rural property is often far away from the local fire station. This puts the home (and the residents) in considerable danger, because if the home catches fire it is more likely that it will not survive. If the lender knows that the borrower will have issues getting insurance, the lender is going to be more hesitant about approving the loan. The loan officer must know how to deal with and resolve those kinds of issues. On the other hand, an advantage of rural properties is that it’s often possible to obtain a loan with the USDA loan program. Fortunately, there are a multitude of great programs for rural properties in the USDA program. Additionally, there are insurance companies that specialize in insurance on rural properties. It’s a niche, but the companies who focus on rural property insurance usually do a great job at it. With that in mind, if your borrower is going to be getting a loan for a rural property, make sure they are working with somebody who knows about those kinds of options. Hard-to-Insure Properties: Rural properties are not the only assets that are hard to insure. Houses in a designated flood zone will need special flood insurance. It’s more expensive to own a
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