Buying a California Condo
Condominiums have some terrific advantages for California homebuyers – especially in the desirable Orange County and coastal areas:
• Lower price points
• Less maintenance and upkeep
• Shared expenses
• More available amenities
Condominiums can be great places to live – and they can make terrific rental properties for investors – but they do take some specialized research and due diligence.
Pacific Home Loans Condominium Home Loans
• Retirement Communities
• Beach and coastal condos
• Oceanfront properties
• Rental properties
• Starter homes
• Town homes
• Luxury condominiums
• Golf communities
Pacific Home Loans specializes in condominium mortgage lending. As long-time mortgage lenders in Southern California, where condominiums are very popular, we have a wealth of experience lending on condominiums in nearly every major development in coastal Orange County.
If you’re looking to buy a condominium in Orange County, or anywhere in California, pick up the phone and speak to one of our condo specialists in our Laguna Beach offices. We can help walk you through some critical considerations when it comes to getting a condominium financed.
Not every condominium is eligible for a conventional, FHA or VA mortgage, for example.
To maximize your chances of getting your condo loan approved without a hitch, you’ll need to know the answers to a few questions:
Is your condominium warrantable, non-warrantable or a condo hotel (condotel)?
The difference is important:
Warrantable condominiums are those that meet Fannie Mae and Freddie Mac guidelines, as well as VA, FHA and USDA home loan standards. Properties that don’t meet the criteria are referred to as “non-warrantable.” See below for more specific information on warrantability.
A Condotel is a term used to describe a condo-hotel. A condotel possesses some hotel-like amenities such as a front desk for checking in and out, and an activities or concierge desk.
Pacific Home Loans proudly offers financing options for all California condo classifications. Visit our Condo Loan Programs page for more information.
If the condo doesn’t qualify under the programs mentioned above, don’t worry: there are a number of lenders who will consider non-warrantable condos and condotels. It just takes some specialized underwriting – and knowing the right lender for the type of property you’re interested in.
Which lender to choose depends on a number of factors, including the current percentage of units that are actually owner-occupied, as opposed to rental investment properties.
That’s where Pacific Home Loans has an advantage over many Orange County lenders: as a mortgage broker with relationships with over 20 lenders, we have plenty of options, making it much more likely we can find a lender with a loan program to fit you and your property.
Often, if you meet our own credit and property criteria, we’ll lend on those properties “in-house.” This can save you money and may lead to an even faster closing. If our own in-house mortgage isn’t a great fit for you, we will work to find you a great mortgage from one of our 20+ partner lenders.
Call a PHL condo mortgage specialist today to start the application process. We will work with you by reviewing the financial documents provided to us from the condominium manager or association to determine which mortgage programs the development will qualify for.
You can start the pre-qualification process now. Click here to fill out an application.
How will I know if my California condo is warrantable?
In order for a condo to be classified as “warrantable,” the subject condo property manager will complete the bank’s condo questionnaire: Fannie Mae Form 1076 or Freddie Mac Form 426.
Note: See “non-warrantable condo” for potential issues with the Forms 1076 and 426 that will require your condo to be financed with a non-warrantable portfolio condo loan.
What are Non-Warrantable California Condominiums?
Non-warrantable condos are those that are not eligible for major “agency” mortgages, such as Fannie Mae, Freddie Mac, and the VA Home Loan Program. An Pacific Home Loans loan officer will determine under which classification your condo falls. If your condo is classified as non-warrantable, you will be offered one of Pacific Home Loans’s competitive rate portfolio loan programs.
What makes a California condominium non-warrantable?
• One owner owns more than 20% of the total units in the project;
• Pending litigation against the HOA. But not all pending lawsuits will classify a condo as non-warrantable;
• More than 10% of the owners are delinquent on HOA fees;
• The condo possesses some hotel-like amenities such as a registration desk and the HOA requires the owners to make their unit available for rental pooling (daily rentals). However, just because a condo allows daily rentals doesn’t automatically classify the condo as non-warrantable.
For more information, visit our Condo Loan Program page now. Or call us today at (949) 494-4861 or toll free (866) 389-2778.
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