Dissolved HOA, Now Property is "Non-Warrantable"?

[Meredith Pacifico]

We're looking at one side of a duplex on a street that once had an HOA, but it has dissolved. The unit was under contract but it fell through because the buyer's bank/financing said the unit was non-warrantable and therefore hiked the interest rate up. My mortgage broker has not heard of this being an issue so long as the unit is insurable. Our realtor had never heard of the term before, either. Has anyone here ever dealt with an issue like this?

[Jay Hurst]

Quote from @Meredith Pacifico:

We're looking at one side of a duplex on a street that once had an HOA, but it has dissolved. The unit was under contract but it fell through because the buyer's bank/financing said the unit was non-warrantable and therefore hiked the interest rate up. My mortgage broker has not heard of this being an issue so long as the unit is insurable. Our realtor had never heard of the term before, either. Has anyone here ever dealt with an issue like this?

Non-warrantable simply means that Fannie/Freddie will not lend on that particular unit. The actual reason that a project might be non-warrantable can be varied.  The insurability has nothing to do with it. I am not sure what the issue would be on your particular unit. I can tell you often this kind of info is kind of like the kids game telephone in that the reason gets passed down from the underwriter to  original LO to the  buyers agent to the listing agent, to your real estate agent etc etc and by the time its get you the real reason is obscured or at least twisted a bit. So, no real help on why, but yes it is a common issue on condo's (especially in Fla)