Investor · Miami, FL · Member since 2017 · 229 posts · 271 votes
Hi all,
I am having some issues going through a conventional finance of a condo I am buying here in Miami. This is the second lender that I have been through that has run into problems trying to close on this condo.
The lender is asking to be named as an additional insured on the HOA Master Policy. This is not the HO6 policy for my individual unit but the HOA insurance policy itself. The HOA is refusing as they say this is highly unusual and has never been required by a lender before with other owners who have purchased in this building with financing.
The mortgage broker insists that this is a standard request in order to be in compliance with Fannie Mae guidelines.
Can anyone or any lender give me any more clarity as to what exactly is going on? I can't imagine a large HOA with hundreds of units having to update their master insurance policy to include or remove lenders every time someone with financing bought or sold a unit.
Any help or clarification on this would be really appreciated.
Real Estate Consultant · Seattle, WA · Member since 2022 · 1k+ posts · 784 votes
4y
Unless there is something special about this condo, yes it is standard process. And yes, the individual certificates of insurance are updated and re-issued every time someone sells or refinances. They also get redone once a year when the policy renews
I am having some issues going through a conventional finance of a condo I am buying here in Miami. This is the second lender that I have been through that has run into problems trying to close on this condo.
The lender is asking to be named as an additional insured on the HOA Master Policy. This is not the HO6 policy for my individual unit but the HOA insurance policy itself. The HOA is refusing as they say this is highly unusual and has never been required by a lender before with other owners who have purchased in this building with financing.
The mortgage broker insists that this is a standard request in order to be in compliance with Fannie Mae guidelines.
Can anyone or any lender give me any more clarity as to what exactly is going on? I can't imagine a large HOA with hundreds of units having to update their master insurance policy to include or remove lenders every time someone with financing bought or sold a unit.
Any help or clarification on this would be really appreciated.
Thanks!
This is a typical request and have the lender or escrow reach out to the insurance company directly. This way the loss payee can be added and everyone can move on to the next task.