the loan application, the loan may be denied. The lenders don’t want the risk of lending on a property that could have problems from a condo association lawsuit. Lenders will also inspect the condominium complex amenities to ensure that they are in good shape. If the complex is in disrepair, that points to two issues: the safety of the residents is at risk, and the condominium association is not spending its money effectively. This could also result in a rejected application. Speaking of the condo association’s money habits, another problem area of condo loans is how much money the condo association has saved. If the association does not have enough money in reserves according to the lender’s requirements, the loan may be denied. Likewise, if 15% or more of the condo association members are behind on their condo association dues, that could also lead to a rejection. Again, all these problem area don’t mean that getting a loan for a condo is impossible. Clearly, people get loans for condos all the time. However, a loan officer who’s never obtained a mortgage for a condo before will probably have a difficult time navigating the tricky waters, so you want to make sure that your lender is prepared. Duplexes, Triplexes and Fourplexes: A “-plex” home is where one building contains multiple homes, each with its own separate entrance. For example, most duplexes look like a large house with two front doors, with each unit of the home occupied by different people. Duplexes, triplexes, and fourplexes are more challenging because if someone is trying to buy one they are likely doing so because they want to make money off the property by renting it to other people. This makes “-plexes” investment properties, and banks are more stringent in lending on income-producing properties.
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