8-unit condo complex non-warrantable??? Each owner owns 12.5%...

[Dustin Palls]

I own a condo in a nice, but small complex... 62.5% of the units are owner occupied... no litigation issues... no delinquencies... good reserves. But are we "non-warrantable" because technically EACH of the eight owners holds 12.5% of the complex?

I'm referring to a guideline that I have seen many times stating that "no one owner can own more than 10% of the units within a given complex" in order for said complex to remain "warrantable".

Can anyone please shed some light on this for me?

Thank you for your help!

Dustin

[Chris Mason]

That's for 21+ unit condos. From Fannie...

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List of Ineligible Project Characteristics

Projects in which a single entity (the same individual, investor group, partnership, or corporation) owns more than the following total number of units in the project:

• projects with 2 to 4 units – 1 unit
• projects with 5 to 20 units – 2 units <--- this is you
• projects with 21 or more units – 10%

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I'm not the boss of anyone's HOA, but if it were me I'd go ahead and put something right in the CC&Rs prohibiting anyone from buying a unit if said purchase would mean that Fannie wont lend on any of the units.