Is it true that having a SFH as a primary allows you easier access for HEL?

[Mike Arias]

From my research, owning a condo as a primary is more restrictive than owning a SFH because lenders view condos are higher risk. Is that true? So if one wants to buy investment properties, is it harder to get approved for home equity loans if you own a condo vs. SFH?

What about townhouse?

[Luis Somoza]

Quote from @Devin Peterson:

Quote from @Mike Arias:

From my research, owning a condo as a primary is more restrictive than owning a SFH because lenders view condos are higher risk. Is that true? So if one wants to buy investment properties, is it harder to get approved for home equity loans if you own a condo vs. SFH?

What about townhouse?

 Hi Mike,

Interesting question. Generally speaking - you can get helocs/heloans with condos,townhomes just as easy as a sfh or 2family. Most of the times it is just additional loan level pricing adjustments that will add to the rate. The process for qualifying is the same as a purchase/refi as far as guidelines and underwriting is concerned. If you are thinking about getting a heloc on a condo or townhome to purchase a multi, it is possible. I recommend calling local banks and credit unions as they will know your area than a broker out of state, etc. if you have any questions feel free to pm me! gl!

Actually, I would clarify that condo's are more complex than any traditional purchase/refi as a condo questionnaire is typically required for FHA/VA/Conventional and Non-QM lending, which adds another step, cost and layer of approval standard to the loan process that isn't required on a SFR/PUD/2-4 unit, as the association needs approval, in addition to the property and the borrower.

Now a HEL/HELOC could be different as those are subject to lender-specific guidelines more so than the others, which are typically investor-driven so it would depend on the specific lender in that case.