Greetings!
In my last blog post, I mentioned that HOA fees may be an issue when a buyer is financing rather than paying cash. Be careful! Even if you are NOT buying distressed real estate, you could still be affected.
As of April 1, 2009, FNMA (Federal National Mortgage Association) put a new guideline in place that pertains to condominiums eligible for financing. The new guideline is as follows:
"No more than 15% of the total units in a project may be 30 days or more past due on their HOA (Homeowners Association) dues. For example, a 100 unit project may not have more than 15 units that are 30 days or more delinquent."
This is another reason why FORECLOSURES are better candidates for purchase than SHORT SALES.
Once a lender has taken legal ownership of the property (through foreclosure), they are required to bring all delinquencies current.
On the other hand, if the real estate in question is in short sale status, chances are high for delinquent HOA dues. The smaller the project, the higher the likelihood that conventional mortgage money cannot be found.
This new guideline change makes it even more difficult to reduce the inventory of distressed real estate, although the cash buyer is always welcome!
Have a great day and please send any questions my way!
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.