Non-Warrantable Condo Loans in Swarthmore, PA

Condo financing in Swarthmore turns on two reviews: one of you and one of the building. When the building falls short of Fannie Mae or Freddie Mac standards, a conventional loan is off the table, but some private investors will still lend there. This page covers how to check a project before you make an offer, what the condo questionnaire asks and how lenders judge an association's budget and reserves.

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Condo buildings in Swarthmore

19.6%Owner homes in 10+ unit buildings

308Owner units in 10+ unit buildings

91%Homes built before 1980

1949Median year built

19.6% of owner-occupied homes in Swarthmore are in buildings with 10 or more units, which is where most condo project reviews happen. 91% of local housing was built before 1980, and older buildings are more likely to face major repairs or reserve questions during a condo review.

Checking a Swarthmore condo building before you make an offer

Write financing protection into your offer. A financing contingency that lasts long enough for the condo review to come back gives you room to walk away if no investor will lend in the building. Talk with your agent about how that timing fits the contract.

Read the condo documents the seller provides with care. Look for rental restrictions, limits on how many units one owner can hold, any commercial space and whether the association is still controlled by the developer. Note any planned repairs to roofs, balconies, facades or structural elements. None of these settle eligibility on their own, but each one tells a loan officer which questions the investor will ask and where the review may slow down.

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Prefer to talk first? Call (888) 508-8976. Applying is not a loan approval or commitment to lend; programs vary by borrower, property and investor. ClearPoint Mortgage Advisors, NMLS #173855. Properties in FL, NY, NJ, PA, CT and VA only.

The condo questionnaire, HOA budget and reserves

Once you apply, the lender sends a condo questionnaire to the association or its management company. It asks how many units exist and how many are sold, how many are owner-occupied or rented, whether any one owner holds many units, how much space is commercial, whether there is pending litigation and whether owners are behind on dues.

Management companies often charge for completing the form, and response times vary, so ask about both. Answers have to be accurate and signed by someone with authority to speak for the association. If an answer is unclear or missing, the lender will ask follow-up questions, which is another reason to start the questionnaire as early as possible.

Who this tends to fit

The association has a lawsuit, thin reserves or a special assessment
A lender told you the condo project you picked does not pass agency review
You own a unit in a building that lost eligibility and want to refinance
You are buying a condo as a second home or rental in a resort-style project
You want to check a building's eligibility before you write an offer

Local offices and Pennsylvania rules to know

Property assessment: Delaware County Assessment Bureau.

Pennsylvania condo rules: Pennsylvania condominiums are governed by the Uniform Condominium Act in Title 68 of the Pennsylvania Consolidated Statutes, which includes a chapter on protection of purchasers covering resales of units; cooperatives and planned communities have their own separate parts of Title 68. Source: Pennsylvania General Assembly.

Condo-hotels, investor-heavy buildings and mixed-use projects

A condo-hotel, or condotel, is a building where units are sold to owners but run much like hotel rooms. Signs include a front desk, daily or weekly rentals, housekeeping and a rental pool that shares income among owners. Agency programs generally will not lend in these projects.

Some non-QM investors do, and they often look at the unit itself as well as the building. Expect questions about the unit's size, whether it has a full kitchen, whether you must join the rental program and what the management agreement says. Some programs allow a unit that you rent through the building's program and others prefer one you keep for personal use, so share your plans with the loan officer at the start.

Before you call

Rental program or management agreements for condo-hotel units
The listing details and the unit and building address
Any notices about lawsuits, assessments or planned repairs
Your income and asset documents for the program you choose
The reserve study, if the association has one

Questions Swarthmore borrowers ask about Non-Warrantable condo loans

What is a reserve study?

A reserve study is a report, usually prepared by a specialist, that lists the building's major parts, estimates when each will need repair or replacement and suggests how much the association should save for that work. Not every association has one. When it exists, lenders and buyers use it to judge whether owners may face large assessments later.

Does it matter how many units in the building are rented?

It can. Agency standards look at owner occupancy and at how many units a single person or company holds. Buildings full of rentals or dominated by one investor often fall outside those standards. Some non-QM investors accept higher rental shares, so the questionnaire answers help a loan officer find a program that fits the project.

Will a lender look at the unit itself in a condo-hotel?

Often, yes. Investors that lend in condo-hotels commonly ask about the unit's size, whether it has a full kitchen, whether owners must join the rental program and what the management agreement allows. Some programs treat a unit you keep for personal use differently from one placed in the rental pool, so tell the lender how you plan to use it.

Who fills out the condo questionnaire?

The association or its management company completes it, usually after your lender sends the form. It asks about units sold, owner occupancy, rentals, commercial space, litigation and owners who are behind on dues. Many management companies charge for the form, and turnaround varies, so ask about both and request it as early as your lender allows.

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Get answers about Non-Warrantable condo loans for a home in or around Swarthmore. Subject to credit approval; programs vary.