So many of the new listings that we're seeing in the REO (foreclosure) market are being purchased by investor/buyers that new rules needed to be written.
The Project Eligibility Review Service (PERS) for condo and co-op projects and changes to its condo and co-op project policies were recently announced by Fannie Mae. The announcement clears up how bank-owned units are treated for determining the owner-occupancy ratio. Established projects, where borrowers will occupy the unit or use the unit as a second home, are not subject to any owner-occupancy ratios, according to the guidelines. These are much more lenient than those we were used to working with.
However, Fannie Mae requires that established condominium projects have an owner-occupancy ratio of at least 51 percent at loan origination for investment properties. For projects where a borrower is an investor and that do not meet the owner-occupied ratio of 51 percent, a waiver based on the overall risk of the project may be requested.
1 comment:
this new regulation of 70% occupancy for loan is ridiculous. I was denied a loan for a new construction condo; how on earth can you get 70% with new construction. I was putting down 35% and still denied! This has gone too far! Something needs to be done now!
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