Seeking advice and lenders for financing Non-Warrantable Condo

Nashville, Tennessee
Private Lending & Conventional Mortgage Advice
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Seeking advice and lenders for financing Non-Warrantable Condo

Patrick Sheehan
Northern Virginia · Member since 2018 · 2 posts · 0 votes

I am purchasing a non-warrantable condo in Nashville, Tennessee.  Initially was planning on doing the standard 25% down-payment, however after finding out that it is a non-warrantable condo, the lender we were using is now only offering an option for a 35% down payment.

Has anybody else had experience with non-warrantable condos or have any lenders that will provide loans that require a lower down payment?

Thanks

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Melvin ListBusiness Member
Lender · Tampa, FL · Member since 2016 · 1k+ posts · 381 votes
4y

@Patrick Sheehan You still might be able to fit this in with a conventional loan with 25% down.  The problem with the condo and the investor concentration is the condo questionnaire.  With 25% down you should be able to find a lender that will not require the condo questionnaire.

C2 Financial
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  • Vanessa Ng
    Lender · Nationwide Lender (48 states) · Member since 2022 · 43 posts · 16 votes
    4y
    Hi Patrick,

    Do you happen to know why the condo is considered non-warrantable?
    0Reply
  • Luka Milicevic
    Real Estate Agent · Nashville, TN · Member since 2015 · 2k+ posts · 2k+ votes
    4y

    @Patrick Sheehan they can't sell the loan to a 3rd party so they have to hold it on the books, hence the higher down payment. 

    Something you need to consider is when you go to sell, your buyer pool is going to be smaller due to the loan availability for non warrantable condos. 

    Try Alex Dowdy at First citizens bank

    1Reply
  • Patrick Sheehan
    OP
    Northern Virginia · Member since 2018 · 2 posts · 0 votes
    4y
    Quote from @Vanessa Ng:
    Hi Patrick,

    Do you happen to know why the condo is considered non-warrantable?

    From what I understand it is because of a lack of owner-occupied units and it being zoned as a STR building

    0Reply
  • Melvin ListBusiness Member
    Lender · Tampa, FL · Member since 2016 · 1k+ posts · 381 votes
    4y

    @Patrick Sheehan You still might be able to fit this in with a conventional loan with 25% down.  The problem with the condo and the investor concentration is the condo questionnaire.  With 25% down you should be able to find a lender that will not require the condo questionnaire.

    C2 Financial
    WebsiteView Page
    1Reply
  • Jonathan Taylor
    Lender · Los Angeles, CA · Member since 2017 · 916 posts · 647 votes
    4y

    @Patrick Sheehan lenders have limits on percentage of Owner occ vs rental, you are correct that if too many are rentals then the condo becomes unwarrantable but can you clarify the STR statement? Buildings arent zoned for STR, its either hospitality (hotel, motel, etc) or for the use of the land (commercial, 1-4, mixed use, etc). Either way, you are looking at 35% down, lenders wont go higher on unwarrantable. At least those in my network.

    0Reply
  • Eric GoldmanBusiness Member
    Lender · PA · Member since 2019 · 357 posts · 190 votes
    4y

    We deal with these in our neck of the woods.  typically 65%

    484-574-4878
    G2loans- Investor and Commercial Mortgages531 Reviews
    WebsiteView Page
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  • Dave Skow
    Lender · Seattle, WA · Member since 2014 · 2k+ posts · 899 votes
    4y

    Movement Mortgage has a " condo can do "  program  designed for non warantable situations  .....let me know if you would like a  TN referal 

    0Reply
  • Robin SimonBusiness Member
    Lender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
    4y
    Quote from @Patrick Sheehan:

    I am purchasing a non-warrantable condo in Nashville, Tennessee.  Initially was planning on doing the standard 25% down-payment, however after finding out that it is a non-warrantable condo, the lender we were using is now only offering an option for a 35% down payment.

    Has anybody else had experience with non-warrantable condos or have any lenders that will provide loans that require a lower down payment?

    Thanks


     Hi - we have tons of experience in both Nashville and non-warrantable condos.  We can do 30% down, send me a PM to discuss, I'd be glad to help!

    [email protected]
    Harpoon Capital514 Reviews
    WebsiteView Page
    0Reply
  • Nick BelskyBusiness Member
    Residential and Commercial Broker · Member since 2021 · 1k+ posts · 704 votes
    4y

    @Patrick Sheehan

    Find a different lender. Plenty do NWCs without the review for 25-30% down. Are you working with a mortgage broker?

    Cheers!

    [email protected]
    Belsky Mortgage, LLC527 Reviews
    WebsiteView Page
    1Reply
  • Kyle DeutschmannPro Member
    Investor · Washington, DC · Member since 2017 · 428 posts · 205 votes
    4y

    From a quick search, it looks like we have a lender/investor we work with that will go up to 80% LTV on a non-warrantable condo in certain cases (up to 85% LTV if Owner occupied or second home). I don't have their rate sheet readily available but I'd imagine rates are a bit higher if you go up to 80 or 85% LTV on a non-warrantable condo as fewer lenders are willing to go that high.

    [email protected]
    0Reply
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